```

[Senate Hearing 108-276]
[From the U.S. Government Publishing Office]

                                                        S. Hrg. 108-276
 
                   IRAQ: NEXT STEPS--WHAT WILL AN IRAQ
                         5-YEAR PLAN LOOK LIKE?
=======================================================================

                                HEARING

                               BEFORE THE

                     COMMITTEE ON FOREIGN RELATIONS
                          UNITED STATES SENATE

                      ONE HUNDRED EIGHTH CONGRESS

                             FIRST SESSION

                               __________

                           SEPTEMBER 24, 2003

                               __________

       Printed for the use of the Committee on Foreign Relations

 Available via the World Wide Web: http://www.access.gpo.gov/congress/
                                 senate

                      U.S. GOVERNMENT PRINTING OFFICE

91-434                       WASHINGTON : 2004
_______________________________________________________________________
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                     COMMITTEE ON FOREIGN RELATIONS

                  RICHARD G. LUGAR, Indiana, Chairman
CHUCK HAGEL, Nebraska                JOSEPH R. BIDEN, Jr., Delaware
LINCOLN CHAFEE, Rhode Island         PAUL S. SARBANES, Maryland
GEORGE ALLEN, Virginia               CHRISTOPHER J. DODD, Connecticut
SAM BROWNBACK, Kansas                JOHN F. KERRY, Massachusetts
MICHAEL B. ENZI, Wyoming             RUSSELL D. FEINGOLD, Wisconsin
GEORGE V. VOINOVICH, Ohio            BARBARA BOXER, California
LAMAR ALEXANDER, Tennessee           BILL NELSON, Florida
NORM COLEMAN, Minnesota              JOHN D. ROCKEFELLER IV, West 
JOHN E. SUNUNU, New Hampshire            Virginia
                                     JON S. CORZINE, New Jersey

                 Kenneth A. Myers, Jr., Staff Director
              Antony J. Blinken, Democratic Staff Director

                                  (ii)

                            C O N T E N T S

                              ----------                              
                                                                   Page

Biden, Hon. Joseph R., Jr., U.S. Senator from Delaware, opening 
  statement......................................................     9
Bremer, Hon. L. Paul, III, Administrator, Coalition Provisional 
  Authority, Baghdad, Iraq.......................................    11
    Prepared statement...........................................    18
    Responses to additional questions for the record from Senator 
      Lugar......................................................    59
    Responses to additional questions for the record from Senator 
      Biden......................................................    61
    Response to an additional question for the record from 
      Senator Allen..............................................    64
    Responses to additional questions for the record from Senator 
      Kerry......................................................    65
Brownback, Hon. Sam, U.S. Senator from Kansas, submissions for 
    the record:
    ``Radical Muslims Killing Muslims,'' article from the 
      Washington Post, June 25, 2003, by Zahir Janmohamed........    47
    ``Afghanistan's Islamic Reaction--The Taliban Are Gone, But 
      Fundamentalists Try to Reassert Power,'' article from the 
      Wall Street Journal, by Philip Shishkin....................    48
Feingold, Hon. Russell D., U.S. Senator from Wisconsin, prepared 
  statement......................................................    39
Hagel, Hon. Chuck, U.S. Senator from Nebraska, prepared statement    27
Lugar, Hon. Richard G., U.S. Senator from Indiana, opening 
  statement......................................................     3

                                 (iii)

  

                           IRAQ: NEXT STEPS--
                WHAT WILL AN IRAQ 5-YEAR PLAN LOOK LIKE?

                              ----------                              

                     WEDNESDAY, SEPTEMBER 24, 2003

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met pursuant to notice, at 9:30 a.m., in room 
SD-216, Hart Senate Office Building, the Hon. Richard G. Lugar 
(chairman of the committee), presiding.
    Present: Senators Lugar, Hagel, Chafee, Allen, Brownback, 
Voinovich, Coleman, Sununu, Biden, Sarbanes, Feingold, Boxer, 
Bill Nelson, Rockefeller and Corzine.
    The Chairman. Good morning. This meeting of the Senate 
Foreign Relations Committee is called to order; and we are 
especially pleased to welcome today Ambassador L. Paul Bremer, 
better known to all of us as Jerry Bremer, Administrator of the 
Coalition Provisional Authority in Baghdad.
    Ambassador Bremer, we thank you for coming. We recognize 
that for almost 5 months you have had one of the toughest jobs 
in the world and have been in one of the brightest spotlights 
in the world. You have performed courageously and admirably and 
we ask that you pass on our appreciation to the dedicated 
public servants from many agencies, from coalition governments, 
and from militaries, who are working 18-hour days with you in a 
very dangerous and difficult environment on behalf of peace, 
stability, and democracy in Iraq.
    We look forward today to your status report on the ongoing 
war and on the complex political and economic reconstruction 
efforts in Iraq. After today, the Foreign Relations Committee 
will have held 12 hearings on Iraq so far this year. We have 
maintained this focus, not simply to generate public 
information or opportunity to second guess strategy, but 
because we believe Congress can and should be helpful in 
developing and supporting effective policies in Iraq.
    The United States must succeed in Iraq. And I am hopeful 
that you will ask us for any legislation authority or financing 
that you lack. The most immediate question is the shape of the 
$87 billion supplemental request from President Bush. But our 
committee is addressing Iraqi reconstruction in a wide 
strategic framework that includes such topics as Iraq's 
relationship to the war on terrorism generally, its impact on 
America's international relationships, and its effect on the 
broader political and economic dynamics in the Middle East.
    Personally, I have advocated a 5-year plan in Iraq, not 
because I believe the United States must stay in Iraq for 
exactly that length of time, but because I believe such a plan 
would demonstrate commitment, promote realistic budgeting, and 
help prevent policy drift.
    A long-term plan, in my judgment, is crucial to reaffirm 
and to maintain the support of the American and the Iraqi 
people, to bring aboard more international partners. Iraqis 
must have confidence that Americans and the world community 
will stay until a self-sufficient, independent Iraq is 
realized. Our planning must reflect the promise to establish an 
Iraqi Government that is representative, that is effective, and 
that is underpinned by protected freedoms and a market economy.
    Many Iraqis have had a difficult time understanding how the 
most powerful nation in the world could defeat their Armed 
Forces in 3 weeks and still have trouble getting the lights 
turned on. Yet skepticism and frustration and extremely 
difficult conditions have not eliminated hope among the Iraqi 
people. A recent poll conducted by Zogby International, working 
with the American Enterprise Institute, found that 70 percent 
of Iraqis feel that their country will be better off in 5 years 
down the road. Seventy-one percent believe that they personally 
will be better off in 5 years.
    Iraqis, by a three-to-one margin, responded that politics, 
not economics, will be the harder part of the reconstruction. 
Asked to choose which government they saw as the best model for 
Iraq from among the alternatives of Syria, Iran, Egypt, Saudi 
Arabia, or the United States, 37 percent picked the United 
States. Only 33 percent said they preferred an Islamic 
government. Two-thirds said that U.S. troops should remain in 
Iraq for at least another year.
    Now, statistics can be misleading. But as a scientific 
survey, these responses are encouraging. And I am hopeful you 
can shed light on other positive developments of which the 
American people are not aware, while keeping in mind that they 
worry about the extreme dangers that persist; and in some cases 
seem to be increasing, even as the summer heat dissipates.
    To set the stage for our inquiries today, I would offer the 
following set of questions, which I believe are covered in your 
testimony, to explore as Senators have opportunities:
    What would a 5-year plan for Iraq look like and how much 
would it cost?
    How long will the $87 billion from the supplemental last?
    How long will the $21 billion of that targeted for 
reconstruction last?
    Will the United States commitment help generate 
international contributions at the Donor Conference in October 
or at other conferences surely to come?
    How does oil revenue fit into the projections of 
reconstruction financing, quite apart from the overall budget 
of the country?
    Do you have the right people in place in Iraq?
    Are there enough Arab linguists, international economists, 
public diplomacy experts, development analysts, and technical 
experts?
    What skills do our personnel lack?
    Can expanded international involvement improve our 
capabilities?
    And are you getting recruits for the jobs that you have 
open from our State Department now or from others of that 
expertise in our government?
    You have been tremendously upbeat regarding prospects for 
success in Iraq. Although much progress has been made, what 
worries you about your plans? And what needs to be fixed within 
the Coalition Provisional Authority?
    Much has been made about transferring authority to the 
Iraqis quickly. You envision turning power over to Iraqi 
leadership in stages, as institutions become capable of taking 
on responsibilities.
    How do you plan to integrate Iraqi governmental 
institutions into the coalition's effort? Are there any areas 
or ministries where the transfer process will occur soon?
    Finally, as we look to our foreign policy equities, calling 
on your experience in diplomacy and terrorism, where does Iraq 
now fit in the global war on terrorism? Are Middle East 
neighbors of Iraq providing sufficient cooperation in that 
endeavor?
    Those are at least some of the questions that I suspect 
will come before our panel. Having seen a bit of your 
testimony, I suspect that you will respond to many at the 
beginning. We very much appreciate your being here.
    [The opening statement of Senator Lugar follows:]

             Opening Statement of Senator Richard G. Lugar

    The committee is pleased to welcome Ambassador L. Paul Bremer III, 
Administrator of the Coalition Provisional Authority in Baghdad.
    Ambassador Bremer, we thank you for coming and recognize that for 
almost five months, you have had one of the toughest jobs and have been 
in one of the brightest spotlights in the world. You have performed 
courageously and admirably. We ask that you pass on our appreciation to 
the dedicated public servants from many agencies, coalition 
governments, and militaries who are working 18-hour days with you in a 
dangerous environment on behalf of peace, stability, and democracy in 
Iraq.
    We look forward to your status report on the ongoing war and the 
complex political and economic reconstruction effort in Iraq. After 
today, the Foreign Relations Committee will have held twelve hearings 
on Iraq so far this year. We have maintained this focus, not simply to 
generate public information or opportunities to second-guess strategy, 
but because we believe Congress can and should be helpful in developing 
and supporting effective policies in Iraq. The United States must 
succeed in Iraq. I am hopeful that you will ask us for any legislation, 
authority, or financing that you lack.
    The most immediate question is the shape of the $87 billion 
supplemental request from the President. But our committee is 
addressing Iraqi reconstruction in a wide strategic framework that 
includes such topics as Iraq's relationship to the war on terrorism, 
its impact on America's international relationships, and its effect on 
the broader political and economic dynamics in the Middle East.
    I have advocated a five-year plan in Iraq, not because I believe 
the United States must stay in Iraq for exactly that length of time, 
but because such a plan would demonstrate commitment, promote realistic 
budgeting, and help prevent policy drift. A long-term plan is crucial 
to reaffirm and maintain the support of the American and Iraqi people 
and to bring aboard international partners.
    Iraqis must have confidence that Americans and the world community 
will stay until a self-sufficient, independent Iraq is realized. Our 
planning must reflect the promise to establish an Iraqi government that 
is representative, effective, and underpinned by protected freedoms and 
a market economy.
    Many Iraqis have had a difficult time understanding how the most 
powerful nation in the world could defeat their Armed Forces in three 
weeks and still have trouble getting the lights turned on. Yet 
skepticism, frustration, and extremely difficult conditions have not 
eliminated hope among the Iraqi people.
    A recent poll, conducted by Zogby International working with the 
American Enterprise Institute, found that 70 percent of Iraqis feel 
that their country will be better off five years down the road, and 71 
percent believe that they personally will be better off in five years. 
Iraqis, by a three-to-one margin, responded that politics, not 
economics, will be the harder part of the reconstruction. Asked to 
choose which government they saw as the best model for Iraq from among 
Syria, Iran, Egypt, Saudi Arabia or the United States, 37 percent 
picked the United States. Only 33 percent said they preferred an 
Islamic government. Two-thirds said that U.S. troops should remain in 
Iraq for at least another year.
    Statistics can be misleading, but as a scientific survey, these 
responses are encouraging. I am hopeful that you can shed light on 
other positive developments of which the American people are not aware, 
while keeping in mind that they worry about the extreme dangers that 
persist and, in some cases, seem to be increasing even as the summer 
heat dissipates.
    To set the stage for our inquiries today, I would offer the 
following set of questions:

          (1) What would the five-year plan for Iraq look like and how 
        much would it cost? How long will the $87 billion from the 
        Supplemental last? How long will the $21 billion targeted for 
        reconstruction last? Will this U.S. commitment help generate 
        international contributions at the donor conference in October? 
        How does oil revenue fit into projections of reconstruction 
        financing?

          (2) Do you have the right people in place in Iraq? Are there 
        enough Arab linguists, international economists, public 
        diplomacy experts, development analysts, and technical experts? 
        What skills do our personnel lack? Can expanded international 
        involvement improve our capabilities?

          (3) You have been tremendously upbeat regarding prospects for 
        success in Iraq. Although much progress has been made, what 
        worries you about your plans? What needs to be fixed within the 
        Coalition Provisional Authority?

          (4) Much has been made about transferring authority to the 
        Iraqis quickly. You envision turning power over to Iraqi 
        leadership in stages, as institutions become capable of taking 
        on responsibilities. How do you plan to integrate Iraqi 
        government institutions into the Coalition's effort? Are there 
        any areas or ministries where the transfer process will soon 
        occur?

          (5) Finally, as we look to our foreign policy equities, 
        calling on your experience in diplomacy and terrorism, where 
        does Iraq now fit in the Global War on Terrorism? Are Middle 
        East neighbors of Iraq providing sufficient cooperation?

    Again, Ambassador Bremer, we thank you for joining us today, and we 
look forward to your testimony and our continuing dialog on these 
issues.

    The Chairman. I call now upon the distinguished ranking 
member of our committee, Senator Biden, for his opening 
statement.
    Senator Biden. Thank you, Mr. Chairman.
    Welcome, Mr. Ambassador. I realize this has been an 
interesting time coming back home. You are probably anxious to 
get back to Iraq.
    Ambassador Bremer. Well, I have better electricity supply 
in Iraq, Senator.
    Senator Biden. And probably fewer questions.
    But, Mr. Ambassador, I want to thank you for being here and 
thank you for making yourself available to some of my 
colleagues yesterday, I assume, in informal sessions; you did 
it for both Democrats and Republicans.
    And I want to say at the outset that your being made 
available is--we are thanking you for it but it is an absolute, 
positive necessity. Failure to do so would not be in your 
thinking; the Congress, as you can tell, is very concerned 
about what is going on.
    I hope the vast majority of the Members of Congress and 
both parties still have open minds. I, for one, think we need 
to stay the course. And we need to fund this operation, as 
expensive as it is. But I think you have probably gotten the 
message how intensely some Members feel.
    And you are here today. And you are going to return to 
Baghdad, to what I believe is a situation not of your making, 
although made much worse because of a failed plan for the 
aftermath of a brilliantly executed war; that is not your 
fault. You were brought in to salvage a situation that was 
deteriorating dangerously by the day. I remind myself, and 
everyone else, that you were not part of the picture, 
initially. We had all these hearings and all the planning was--
it was going to be Garner in charge, and Chalabi was going to 
be airdropped in; and all was going to be well. That is a bit 
of facetiousness on my part but you were not in the picture.
    And I commend you for being willing to take on this job. I 
am sure some of your friends had to counsel you it was a bad 
idea but I am glad you did it. I commend you for the level of 
energy and focus you have brought to this to turn around a 
situation that I think is imminently salvageable.
    You brought something else to the table, even more critical 
to the willingness of the American people and the Congress to 
continue to support this endeavor in Iraq; and that is honesty. 
You are the first guy that told us the facts, told us the 
truth; the others did not lie, the others just either did not 
know or did not say what they knew.
    During your visit in July, you began to make clear what 
many in this committee have been saying for the past year, that 
reconstructing Iraq will be a lot more difficult than winning 
``the war'' and will take tens of billions of dollars over 
several years and require tens of thousands of American troops 
for an extended deployment.
    Prior to that, we had heard obfuscation upon obfuscation, 
rosy scenarios, and a word which has worked its way into the 
lexicon of some in this administration: ``unknowable.'' If I 
hear the word ``unknowable'' one more time from this 
administration, I would suggest that they, in their effort to 
stay in power say: Vote for us, we are the unknowables, we do 
not know anything.
    In fact, the problem and the prescriptions for post-war 
Iraq were absolutely knowable; not in detail but absolutely 
knowable. From the hearings this committee convened well over a 
year ago under both chairmanships, from the work of our leading 
think tanks, left, right, and center, and from within the 
administration itself, thanks to the State Department's Future 
of Iraq Project, which developed detailed plans for post-war 
Iraq, a lot was knowable.
    Instead, the administration waited until the eleventh hour 
to begin planning. Its leading members believed we would find 
an oil-rich, functioning country--that we would be met by 
cheering crowds, that all we would have to do is sweep out the 
top Baathist layers, implant our favorite exiles, and watch 
democracy take root, as the bulk of our troops returned home by 
Christmas.
    Well, the reality, as you know better than anyone in the 
whole world, is quite different. You have seen it. You have 
experienced it. And you have tried to deal with it. And as the 
chairman, Senator Hagel, and I have seen during our visit to 
Baghdad, you are going at it full tilt.
    Belatedly but thankfully in my view, the President made a 
sufficient U-turn 2 weeks ago that hopefully finally sets us in 
the right direction. First, he vowed to make Iraq the world's 
problem, not just our own, by going back to the United Nations 
and seeking support of its members for troops, police, and 
money.
    Because this is a simple calculation. We have three 
options: one, we leave and there is chaos and there is 
strategic debacle; two, we stay and pay for everything; or 
three, we get other folks to pay. This is not hard. This is not 
very difficult to understand. It took awhile for the President, 
I think, to understand it but I do not get it. This is real 
simple. We leave, we pay, or we get others to help pay, in 
terms of their lives, in terms of their money, in terms of 
their troops.
    First, as I said, the President has come around. And he has 
said he is going to seek that support by going back to the 
United Nations, which he did yesterday. I regret that his 
speech, although, I think, as they say in medicine, did no 
harm--I am not sure, based on the accounts of today, that it 
did all that much good in terms of its stated purpose, rallying 
the world to support us with money and troops.
    I think he should have made more clearly our willingness to 
bridge the differences with our allies on a new U.N. resolution 
and to grant the U.N. real authority, laid out some specifics, 
and asked for help; and use the word ``ask,'' ask for help. I 
am not one of those guys who thinks he should go and apologize 
for anything; he had nothing to apologize for. But he could 
ask. You know? It is a useful thing.
    I met with one of our counterparts in the European 
Community just before I went to see you about three months ago. 
And I asked, ``What do we have to do?'' And this very pro-
American, very significant figure leaned over to me and said, 
``You've got to ask; not challenge, not demand, not offer to 
share, ask.''
    So, I am left questioning the sincerity of the President's 
mid-course correction. If we want the world to share the 
burden, we have to share the authority in Iraq in a meaningful 
way. The players--the payers, they want to be players. If they 
pay, they want to have something to say.
    I cannot believe that we cannot find a compromise that 
meets our rightful concerns about a premature transfer of power 
but also empowers the U.N. and starts to put more power in the 
hands of the Iraqi people. For example, what about double-
hatting you? What about double-hatting you additionally as a 
representative of the international community. I know you know 
what I mean--that you run the show under the U.N. auspices.
    I am not sure exactly how it would work. But we both know 
from past experience--mine is as long as yours. I have been 
doing this 31 years--the guy who pays the bill at the U.N. gets 
to call the shots. The person who has all the troops on the 
ground gets to command the troops.
    I mean, I do not know why we do not say to the French, You 
want a piece of this? Fine. We put in $20 billion. You want to 
run it. Let us see your $30 billion.
    But the point I am trying to make is that I do not 
understand why we cannot move in a way that is a little bit 
different than we have until now. Instead of reporting to Mr. 
Rumsfeld, you report to an international board of directors or 
the U.S. as the chairman of the board, because we would be 
putting in most of the money. I am not sure what is wrong with 
that idea. I would like to talk to you about that.
    Second, the President began to level with the American 
people about the hard road ahead to win the peace, in terms of 
time, troops, and treasures. Now, I hope the administration 
continues to level with the American people. It is the only way 
to sustain their support.
    But the approach to the supplemental concerns me on this 
account, as well. Mr. Ambassador, in your testimony before the 
Senate Appropriations Committee on Monday, you noted that the 
World Bank estimates for the total cost of reconstruction, not 
dissimilar to the ones that you have given, to be about $60 
billion to $70 billion over the next 4 or 5 years. This 
supplement request covers $20 billion of that total.
    It begs a critical question. Where are we going to get the 
remaining $40 billion to $50 billion? Where is it going to come 
from? I do not expect you to have that answer. But again, back 
to the central theme. Everybody acknowledges that is what we 
need. We are either going to have to get it from the Iraqis, we 
are going to get it from the international community, or it is 
going to come from us.
    Will it come from the international community? Well 
normally, that would be a reasonable expectation. The United 
States typically covers about 25 percent of post-conflict 
reconstruction costs. By that ratio we could expect $80 billion 
from the international community. But we so poisoned the well 
in the lead up to this war that no one expects the 
international community to provide more than $2 billion or $3 
billion at the Donor's Conference next month.
    That is a terrible indictment, in my view, of our foreign 
policy and a harsh example of the price of unilateralism. Will 
the missing money be generated by Iraqi oil revenues? That is 
what the administration led the American people to believe. In 
fairness, you did not. In fact, if we are lucky, oil exports 
will generate just enough money to pay for the government's 
operating costs this coming fiscal year; forget about paying 
for reconstruction.
    Will the missing money be generated by other parts of the 
Iraqi economy? Secretary Rumsfeld recently touted the potential 
of Iraq's tourism industry. Well, the banks of the Tigris may 
replace the Outer Banks as a destination of choice some day but 
I do not think it is going to happen any time soon.
    Or maybe the missing money will come from the taxpayers, 
when the administration comes back to Congress next year or the 
year after. And if that is the plan, we should know relatively 
soon.
    Mr. Ambassador, you know how critical it is for us to show 
Congress and the American people your plan for turning things 
around in Iraq, if we are going to give the administration the 
money it now seeks. No one wants to be throwing money away and 
surely you do not either, much less throw away American lives. 
So, we need to be convinced you have a workable plan with clear 
benchmarks, timetables, and accountability.
    I do not want to minimize the successes you have already 
achieved. The chairman, Senator Hagel, and I saw them during 
our visit. We saw a local council meeting taking place. Hopeful 
beginnings and grass-roots democracies have expanded all across 
Iraq. Schools are open all around the country. Hospitals are 
caring for the sick. These are major achievements on your part 
and the part of our government.
    But we do not read about them very much; we do not read 
about them very much. And we do not see them on TV. But Mr. 
Ambassador, all this progress is jeopardized by our failure 
thus far to get the two fundamentals as right as they should 
be, security and basic services. And that failure is compounded 
by the huge expectation gap created when we toppled, in 3 
weeks, a tyrant who had plagued the Iraqi people for three 
decades.
    The Iraqi people cannot understand, as you know better than 
anyone, why we cannot restore a sense of personal security and 
turn the lights back on as quickly as we defeated Saddam. Just 
as important, they do not seem to know what we are doing about 
these problems or when things are likely to get better.
    You know, I have found it interesting. As you were kidding 
about the lights not being on because of the hurricane here, 
the American people want to know from me, Connective or 
whatever the energy company in this area is--I do not live 
here--is going to turn on the lights. Now, when you tell them 
and you give me a timeframe, it calms them down. And you say we 
are working on it, we are working on it, it does not help very 
much. But when you said back home it is going to take a week, 
they grumble, they are angry, but they say, OK, in a week, I 
get it.
    The fact of the matter is that if the American people 
understand that, about how they feel, they should have some 
sense of what it has been like all summer for you with 128/130 
degree weather and insufficient electricity.
    Yesterday we heard from Dr. Hamre, who was asked by 
Secretary Rumsfeld this summer to assess the situation on the 
ground. You hosted him, you had his committee out there, and 
you fully cooperated with him. The report that his team 
produced spoke of a window of opportunity that was closing 
rapidly. The window he was talking about was the very poll that 
was recited by the chairman, which I think was at least a month 
old or so.
    And he made very specific recommendations, echoed by our 
bipartisan staff committee report, in key areas, including 
security, services, jobs, and communications. I would like to 
know what has been done to adopt these recommendations. I am 
deeply concerned that the window Dr. Hamre referred to was 
almost closed.
    A New York Times story on September 17, entitled ``Iraqi's 
Bitterness is Called Bigger Threat Than Terror'' cited new 
intelligence assessments ``warning that the United States most 
formidable foe in Iraq in the months ahead may be the 
resentment of ordinary Iraqis increasingly hostile to U.S. 
military occupation.''
    Later it said, ``Defense officials spoke on condition of 
anonymity, saying they were concerned about retribution for 
straying from the official line. They said it was a mistake for 
the administration to discount the role of ordinary Iraqis who 
have little in common with the groups Mr. Rumsfeld cited,'' I 
am still quoting, ``but whose anger over American presence 
appears to be kindling some sympathy for those attacking 
American forces.''
    Mr. Ambassador, if this report is true, this is very bad 
news. I still believe that this is totally doable, but only if 
we act with a sense of urgency and if we involve the 
international community and make concessions about sharing 
authority, to lend legitimacy to the effort, and to share the 
enormous burden. We cannot afford to lose this.
    If we fail, our credibility and our national security will 
be damaged badly. And I do not buy the terrorism argument. Our 
security situation will be damaged badly because of the 
strategic change that will take place in that region with a 
country of 70 million people seeking a nuclear capability 
called Iran, being surrounded by two failed States, Afghanistan 
and Iraq, jeopardizing Turkey as well as Pakistan, and probably 
causing a couple of Arab governments to fall in the process. 
That is the strategic imperative, from my point of view, as to 
why we must succeed.
    Iraq may become a failed State. And our enemies will be 
emboldened. But if we succeed, we can begin to alter the 
strategic map of the region for the better, strengthen reform 
throughout the Middle East, making the Arab-Israeli peace more 
likely, and put our enemies on the defensive.
    So, Mr. Ambassador, to save you the suspense, I intend to 
support giving you the resources you need to get the job done. 
But I have very specific questions about the plans. And I also 
have very specific questions about the sincerity of, and the 
likelihood of, the ability to share responsibility. And I want 
to know whether you are part of the solution on that or you 
have become the pro-counsel and decided no, no, you are the 
only guy that can do this.
    And I am going to be very blunt with you about it. You have 
always been straight with us, a thing we most appreciate about 
you. I welcome you and I thank you for the job you have been 
doing.
    [The opening statement of Senator Biden follows:]

           Opening Statement of Senator Joseph R. Biden, Jr.

    Mr. Ambassador, welcome. And thank you for the work that you and 
your colleagues are performing under very difficult conditions in 
Baghdad.
    You are here today and you will return to Baghdad shortly because 
the administration failed to plan well for the aftermath of a 
brilliantly executed war. That is not your fault. You were brought in 
to salvage a situation that was deteriorating dangerously by the day. I 
commend you for bringing a level of energy and focus that is needed to 
turn things around.
    You have brought something else to the table even more critical to 
the willingness of the American people and the Congress to continue to 
support the endeavor in Iraq: honesty. During your visit in July you 
began to make clear what many on this committee had been saying for a 
year. That reconstructing Iraq will be more difficult than winning the 
war and take tens of billions of dollars over several years and require 
tens of thousands of American troops on an extended deployment.
    Prior to that, we had heard obfuscation upon obfuscation, rosy 
scenarios, and a word which has worked its way into the lexicon of some 
in this administration--``unknowable.''
    In fact, the problems and the prescriptions for post-war Iraq were 
absolutely knowable . . . from the hearings the chairman and I convened 
last year . . . from the work of our leading think tanks . . . and from 
within the administration itself thanks to the State Department's 
Future of Iraq project, which developed detailed post-war plans.
    Instead, the administration waited until the eleventh hour to begin 
planning. Its leading members believed we would find an oil-rich, 
functioning country, that we would be met by cheering crowds, that we 
could sweep out the top Ba'athist layers, implant our favorite exiles, 
and watch democracy take root as the bulk of our troops returned home 
well before Christmas.
    Well the reality as you know better than anyone is quite different 
as--and as the Chairman, Senator Hagel and I know from our visit to 
Iraq.
    Belatedly, but thankfully, the President made a significant U-turn 
two weeks ago that finally sets us in the right direction.
    First, he vowed to make Iraq the world's problem, not just our own, 
by going back to the U.N. and seeking support of its members for 
troops, police and money. It's a simple calculation. We leave and leave 
chaos in our wake. We keep paying for everything in tomes of lives and 
resources. Or, we get others to share the burden.
    I regret that his speech to the U.N. yesterday missed an 
opportunity to rally the world to this cause. He should have made clear 
our willingness to bridge the differences with our allies on a new U.N. 
resolution and to grant the U.N. real authority, laid out some 
specifics, and asked--asked--for help. Not apologize--he had nothing to 
apologize for--but ask.
    So I'm left questioning the sincerity of the President's mid-course 
correction. If we want the world to share the burden, we've got to 
share authority in Iraq in meaningful ways. The payers want to be 
players. And I can't believe we can't find a compromise that meets our 
rightful concerns about a premature transfer of power, but that also 
empowers the U.N. and starts to put more power in the hands of the 
Iraqi people. For example, what about ``double hatting'' you as the 
representative of the international community. Instead of reporting to 
Mr. Rumsfeld, you'd report to an international board of directors, with 
the U.S. as chairman of that board because we'd be putting the most 
into the pot. What's wrong with that?
    Second, the President began to level with American people about the 
hard road ahead to win the peace in terms of time, troops and treasure.
    I hope the administration continues to level with the American 
people. It's the only way to sustain their support. But the approach to 
the supplemental concerns me on this account too.
    Mr. Ambassador, in your testimony before the Senate Appropriations 
Committee on Monday, you noted that the World Bank estimates the total 
cost of reconstruction to be about $60 to $70 billion over the next 
four to five years. The supplemental request covers $20 billion of that 
total. That begs a critical question: where is the remaining $40 to $50 
billion going to come from?
    Will it come from the international community? Normally, that would 
be a reasonable expectation: the United States typically covers about 
25 percent of post-conflict reconstruction costs. By that ratio, we 
could expect about $80 billion from the international community for 
Iraq.
    But we so poisoned the well in the lead up to this war that no one 
expects the international community to provide more than two or three 
billion at the donors conference next month. That's a terrible 
indictment of our foreign policy and a harsh example of the price of 
unilateralism.
    Will the missing money be generated by Iraq's oil revenues? That's 
what the administration led the American people to believe in fairness, 
you did not. In fact, if we're lucky, oil exports will generate just 
enough money to pay for the government's operating costs. Forget about 
oil paying for reconstruction.
    Will the missing money be generated by others parts of the Iraqi 
economy? Secretary Rumsfeld recently touted the potential of Iraq's 
tourism industry. The banks of the Tigris may replace the Outer Banks 
as a destination of choice someday, but not any day soon.
    Or maybe the missing money will come from taxpayers when the 
administration comes back to Congress next year or the year after to 
ask for more. If that's the plan, tell us now.
    Mr. Ambassador, you know how critical it is for you to show 
Congress and the American people your plan for turning things around in 
Iraq if we are to give the administration the money it now seeks. No 
one wants to be throwing money--much less American lives--down a black 
hole. So we need to be convinced you have a workable plan with clear 
benchmarks, timetables and accountability.
    I don't want to minimize the successes you've already achieved. The 
chairman, Senator Hagel, and I saw some of them during our visit. We 
saw a local council meeting taking place--the hopeful beginnings of 
grassroots democracy.
    Schools are open around the country. Hospitals are caring for the 
sick. These are major achievements and we do not read about them or see 
them on TV.
    But Mr. Ambassador, all of this progress is jeopardized by our 
failure thus far to get it right in two fundamental areas: security and 
basic services. And that failure is compounded by a huge expectations 
gap created when we toppled in three weeks a tyrant who had plagued the 
Iraqi people for three decades.
    The Iraqi people can't understand why we can't restore a sense of 
personal security, or turn the lights back on as quickly as we defeated 
Saddam. Just as important, they do not seem to know what we are doing 
about these problems and when things will get better. That sense of 
uncertainty threatens to erode their good will toward us.
    Yesterday we heard from Dr. Hamre, who was asked by Secretary 
Rumsfeld this summer to assess the situation on the ground. The report 
that his team produced spoke of the window of opportunity closing 
rapidly.
    And he made specific recommendations--echoed by a staff report this 
committee prepared--in key areas, including security, services, jobs, 
and communications. I'd like to know what has been done to adopt these 
recommendations.
    I am deeply concerned that the window Dr. Hamre referred to is 
almost closed. A New York Times story on September 17 entitled 
``Iraqis' Bitterness Is Called Bigger Threat Than Terror'' cited new 
intelligence assessments ``warning that the United States' most 
formidable foe in Iraq in the months ahead may be the resentment of 
ordinary Iraqis increasingly hostile to the U.S. military occupation.''
    Later, it says ``The defense officials spoke on condition of 
anonymity, saying they were concerned about retribution for straying 
from the official line. They said it was a mistake for the 
administration to discount the role of ordinary Iraqis who have little 
in common with the groups Mr. Rumsfeld cited, but whose anger over the 
American presence appears to be kindling some sympathy for those 
attacking American forces.''
    Mr. Ambassador, if this report is true, it is very bad news. I 
still believe that this is totally doable, but only if we act with 
urgency and only if we involve the international community and to make 
concessions about sharing power, to lend legitimacy to the effort and 
to share the enormous burden.
    We cannot afford to lose this. If we fail, our credibility and 
national security will be damaged badly, our enemies will be 
emboldened, and Iraq may become a failed state. If we succeed, we can 
begin to alter the strategic map of the region for the better, 
strengthen reformers throughout the Middle East, make an Arab-Israeli 
peace more likely, and put our enemies on the defensive.
    So, Mr. Ambassador, to save you the suspense--I intend to support 
giving you the resources you need to get the job done. But I have very 
specific questions about your plans, and, like most of my colleagues, I 
want answers before I give my formal consent. I look forward to your 
testimony.

    The Chairman. Well, Mr. Ambassador, with our send-off, we 
ask you now for your testimony.
    Ambassador Bremer. Thank you, Mr. Chairman.
    The Chairman. We look forward to that. And please take the 
time that you had to make the case, because it is very 
important that you do so.

STATEMENT BY HON. L. PAUL BREMER, III, ADMINISTRATOR, COALITION 
              PROVISIONAL AUTHORITY, BAGHDAD, IRAQ

    Ambassador Bremer. Thank you, Mr. Chairman, and members of 
the committee and thank you for this opportunity. And thank you 
in particular, Mr. Chairman, for your kind words about the 
thousands of people who are working with me, military and 
civilian people, not the least, of course, our men and women in 
the Armed Forces. But I have a lot of civilians, as you pointed 
out, who are working extraordinarily long hours in very 
difficult circumstances and in dangerous circumstances and I 
will certainly convey to them your comment.
    Let me begin by paying tribute to our men and women in the 
armed services. Leading a coalition, our armed services 
delivered a military victory without precedent. In roughly 3 
weeks, they liberated a country larger than Germany and Italy 
combined. And they did so with forces smaller than the Army of 
the Potomac. Our Armed Forces accomplished all of this while 
absorbing and inflicting minimal casualties.
    Iraqis understood that we tried to spare the innocent. 
After the first days of the war, only those citizens in 
Baghdad, living close to obvious targets, feared our bombing. 
Mr. Chairman, I know that you and all Americans hate waking up 
to hear a newscast that begins, ``Last night, another American 
soldier was killed in Iraq.'' Well, my day starts 8 hours 
before yours. And I am among the first to receive word of those 
deaths. And no one regrets them more than I do. But those 
deaths, painful as they are, are not senseless. They are part 
of a price we pay for civilization, for a world that refuses to 
tolerate terrorism, and genocide, and weapons of mass 
destruction.
    Those people who ambush the coalition forces, like those 
responsible for the recent terror bombings and those who 
ambushed Governing Council member Dr. Aquila al-Hashimi last 
Saturday, are trying to thwart constitutional and democratic 
government in Iraq. They are trying to create an environment of 
insecurity.
    Mr. Chairman, they will win some battles but they are 
losing the war with history.
    President Bush's vision, in contrast, provides for an Iraq 
made secure through the efforts of Iraqis. In addition to 
greater security, the President's plan provides for an Iraqi 
economy based on sound economic principles and bolstered by a 
reliable infrastructure. And finally, the President's plan 
provides for a democratic and sovereign Iraq at the earliest 
reasonable date.
    If we fail to recreate Iraq as a sovereign democracy 
sustained by a solid economy, we will have handed the 
terrorists a gift. And with all respect to the Senator from 
Delaware, I think terrorism is a relevant consideration. It may 
not be the only one; there are strategic considerations, but 
terrorism is relevant.
    Mr. Chairman, I might say in your opening remarks, you 
called me a terrorism expert. I like to think of myself as a 
counter-terrorism expert.
    Terrorists love state sponsors, countries that provide them 
with cash, arms, refuge, and a protected place to rest and plan 
future operations. Saddam's Iraq was just such a place. If you 
think back on the Rome and Vienna airport massacres in 1985, 
the architect of those massacres, Abu Nidal, lived out his days 
under Saddam's protection. Similarly, Abu Abbas, the architect 
of the Achille Lauro hijacking and the murder of Leon 
Klinghofer, an American citizen, lived in Baghdad for years as 
an honored guest.
    When terrorists cannot find a congenial state sponsor, they 
seek the environments with little or no effective government. 
When militias, warlords, and communities war with each other, 
terrorists are right at home. Think back on Lebanon in the 
1980s. Either outcome or some combination of both is possible 
in Iraq if we do not followup our military victory.
    The opposite is also true. Creating a sovereign, 
democratic, constitutional, and prosperous Iraq deals a blow to 
terrorists. It shows you can have freedom and dignity without 
using truck bombs to slaughter the innocent. It gives the lie 
to those who describe America as enemies of Islam, enemies of 
the Arab, or enemies of the poor. That is why the President's 
request has to be seen as an important element in the global 
war on terrorism.
    Mr. Chairman, our national experience, as members of this 
committee know, shows how to consolidate military victory. We 
did not have that experience 85 years ago, when we emerged 
victorious from World War I. Many here opposed that war. As a 
Nation, we wished at the end of the war to shake the old world 
dust off our boots and solve the problems at home. We had spent 
and lent a lot of money and a lot of blood. The victors 
celebrated their victory, mourned their dead, and demanded the 
money they were owed.
    We won the war but we did not consolidate the peace. We 
know the results of that policy. Extremism, bred in a swamp of 
despair, bankruptcy, and unpayable debts, gave the world 
fascism in Italy and Nazism in Germany. And the result was 
another world war.
    After that conflict, we showed that we had learned that 
military victory must be followed by a program to secure the 
peace. In 1948, America's greatest generation recognized that 
military victory was hollow if democracy was not reinforced 
against tyranny. Democracy could not flourish unless Europe's 
devastated economies were rebuilt. That generation responded 
with the boldest, most generous, and most productive act of 
statesmanship in the past century, the Marshall Plan, what 
Winston Churchill called ``the most unsordid act in history.''
    When Secretary of State George Marshall first described the 
Marshall Plan at Harvard, he laid out some truths that I think, 
Mr. Chairman, resonate today. I quote: ``Its purpose should be 
the revival of a working economy so as to permit the emergence 
of political and social conditions in which free institutions 
can exist.''
    Highlighting the importance of approaching the issues at 
the highest level, Marshall added, ``Any assistance that this 
government may render in the future should provide a cure 
rather than a mere palliative.''
    The Marshall Plan, enacted, as members know, with 
overwhelming bipartisan support, set war-torn Europe on the 
path to freedom and prosperity, which Europeans enjoy today. 
After 1,000 years as the cockpit of war, Europe has become the 
cradle of peace in two short generations. The Marshall Plan was 
a real investment in American national security.
    The grants to Iraq the President seeks bespeak a grandeur 
of vision equal to the one which created the free world at the 
end of World War II. Iraqis living in freedom with dignity will 
set an example in this troubled region, which so often spawns 
terrorists. A stable, peaceful, economically productive Iraq 
will serve American interests by making America safer.
    Here are a few of the things I want to point out about this 
supplemental request. As Senator Biden has asked, we have a 
plan with milestones, dates, and benchmarks. No one part of 
this $87 billion supplemental is dispensable and no part is 
more important than the others. This is a carefully considered 
integrated request.
    This request is urgent. The urgency of military operations 
is self-evident. The funds for nonmilitary action in Iraq are 
equally urgent. Most Iraqis welcomed us as liberators. And we 
glowed with pleasure at that welcome. But now the reality of 
foreign troops on the streets is starting to chafe. Some Iraqis 
are beginning to see us more as occupiers than liberators. Let 
us not hide the fact.
    Some of this is inevitable. But faster progress on 
reconstruction will help. Unless this supplemental passes 
quickly, Iraqis face an indefinite period with blackouts 8 
hours daily. The link to the safety of our troops is indirect 
but no less real. The people who ambush our troops are small in 
number and do not do so because they have undependable electric 
supplies. But the population's view of America is directly 
linked to their cooperation in hunting down those people who do 
attack us. Early progress gives us an edge against the 
terrorists.
    We need to emulate the military practice of using 
overwhelming force in the beginning. Incrementalism and 
escalation are poor military practice and they are a poor model 
for economic assistance.
    This money, Mr. Chairman, will be spent with prudent 
transparency. Every contract of the $20 billion supplemental 
that I will be responsible for will be competitively bid.
    That the money be granted and not loaned is essential. 
Initially, offering assistance as loans seems attractive. And I 
know some Members of Congress have been attracted to this idea. 
But once again, Mr. Chairman, it pays to examine the facts and 
the historic experience.
    Today, Iraq has almost $200 billion in debt and reparations 
hanging over its head as a result of Saddam's economic 
incompetence and aggressive wars; $200 billion. Iraq is in no 
position to service its existing debt, let alone to take on 
more. Mountains of unpayable debt contributed heavily to the 
instability that paved Hitler's path to power; the giants of 
the post-World War II generation recognized this. And as you 
know, Mr. Chairman, the vast majority of Marshall Plan funds 
were in the form of grants.
    The President's first priority in the plan for Iraq is 
security, security provided by Iraqis and to Iraqis. That 
security extends to our forces and changes Iraq from a 
logistics and planning base for terrorists and criminals into a 
bulwark against them.
    The President's plan envisions three pillars of security: 
public safety, police, border enforcement, fire brigades, and a 
communications system; second, national defense, a new army and 
civil defense system; and finally, a justice system affecting 
courts and prisons.
    This security assistance to Iraq benefits the United States 
in four immediate ways. First, Iraqis will be more effective 
than we are. As talented and courageous as our forces are, they 
can never replace an Iraqi policeman who knows his beat, who 
knows his people, their language, their customs, and their 
rhythms. Iraqis want Iraqis to provide their security, and so 
do we.
    Second, as these Iraqi security forces assume their duties, 
they replace coalition troops in many of the roles that 
generate frustration, friction, and resentment; things like 
conducting searches, manning checkpoints, and guarding 
installations.
    Third, this in turn frees up coalition forces for the 
mobile, sophisticated offensive operations against former 
regime loyalists and terrorists for which they are best suited.
    And finally, these new Iraqi forces reduce the overall 
security demands on coalition forces and speed the day that we 
all hope for, when we can bring our troops home.
    Security is the first and indispensable element of the 
President's plan, as you mentioned in your statement, Mr. 
Chairman. But it is not by itself sufficient to assure success, 
because a security system resting only on arms is a security 
system that will fail. Recreating Iraq as a nation at peace 
with itself and with the world, an Iraq that terrorists flee 
from rather than flock to, requires more than people with guns. 
A good security system cannot persist on the knife-edge of 
economic collapse.
    When Saddam scurried away from the coalition forces in 
April, he left behind an economy ruined not by our attacks but 
by decades of neglect, theft, and mismanagement. Imagine the 
effect on the economy of operating without a budget for a 
quarter century. Saddam came to power in 1979 and he never once 
prepared a national budget.
    Ill-conceived and clumsily executed polices left Iraq with 
an oil industry starved nearly to death by under-investment, 
thousands of miles of irrigation canals so weed-clogged as to 
become almost useless, and an electrical system that can meet, 
at best, two-thirds of demand.
    Reflect, if you will, Mr. Chairman, on that last item. As 
millions of American households, including my own and I am sure 
many of the people who live in the District, will recall, it is 
almost impossible to live in the modern world without 
dependable electricity. Think of what we would be asking the 
Iraqis were we to suggest they fashion a new economy, a new 
democracy, while literally in the dark 8 hours a day.
    The Iraqis must refashion their economy. Saddam left them 
with a Soviet-style command economy. And that poor model, 
further hobbled by cronyism, theft, and pharaohnic self-
indulgence by Saddam and his intimates, is what we face.
    Important changes have already begun. You may have noticed 
the Iraqi Minister of Finance on Sunday at the IMF meetings in 
Dubai, where he led a delegation, announced a set of market-
oriented policies that is among the world's boldest and 
certainly the boldest in the region. It goes to the point that 
Senator Biden was making about the strategic importance of what 
we are doing there.
    The highlights, Mr. Chairman, a central bank law, which 
grants the Iraqi Central Bank full legal independence. On the 
Iraqi Governing Council, he announced, and on Thursday I signed 
into law, a program providing Iraq, opening Iraq to foreign 
investment. Foreign firms may now open wholly owned companies 
or buy 100 percent of Iraqi businesses. Under this law, foreign 
firms receive national treatment and have an unrestricted right 
to remit profits and capital.
    Iraq's tariff policy is equally simple. There is a 2-year 
reconstruction tariff of 5 percent on all but a few imports. 
Foreign banks today are free to enter Iraq and will receive 
equal treatment with Iraqi banks.
    On October 15, Iraq will get, for the first time in 20 
years, a single new currency called the New Dinar. And that 
will float against the world's currencies.
    Iraq's pro-growth policies should bring real sustained 
growth and protect against something we have all seen and 
regretted, which is economic assistance funds disappearing into 
a morass of poverty through ineffective spending.
    Mr. Chairman, the Iraqi Government, by these measures, has 
put in place the legal procedures for encouraging a vibrant 
private sector, what I call the legal infrastructure. But those 
polices will come to nothing if Iraq must try to reestablish 
itself on an insufficient and unreliable electric grid or in a 
security environment that puts a stick in the spokes of the 
wheels of commerce.
    Iraq cannot realize its potential to return quickly to the 
world stage as a responsible player without the services 
essential to a modern economy. We have made significant 
progress, as those of you who have visited Iraq learned when 
you were there, in restoring essential services. The widely 
predicted humanitarian crisis did not happen. There was no 
major flow of refugees.
    As you pointed out, all of Iraq's 240 hospitals and 90 
percent of its health clinics are up and running. The schools 
are open. The universities held their exams. There is an 
adequate supply of food. And there are no signs of epidemics. 
We have already cleared thousands of miles of irrigation canals 
across the country. Electric service--electric power service 
will reach pre-war levels within this next month.
    But the remaining demands are vast, which is why most of 
the President's request for nonmilitary assistance is for 
infrastructure programs.
    On another front, there is already good news, as members of 
this committee know. The democratization of Iraq, on which so 
much global attention has been focused, is further advanced 
than many casual readers of the newspapers might know; although 
I know members of the committee, particularly those who were in 
Iraq, who saw a town council meeting, are aware of how far 
things have come.
    We have encouraged a quick political transformation and 
laid out a clear seven-step process leading to Iraqi 
sovereignty. Three of the seven steps have already been taken. 
The Governing Council came into being on July 13. Second, the 
Governing Council appointed a preparatory committee to write a 
constitution. And on September 1, the Governing Council took 
the third step, appointing a very able group of 25 ministers to 
run the ministries governments.
    I might add here, Mr. Chairman, that I learned that of the 
25 ministers, 17 have Ph.D.s, which must make it not only the 
best-educated cabinet in Iraq's history but probably one of the 
world's best-educated cabinets. And I do not know if any of the 
members had a chance to meet two of the ministers who have been 
here this week. If you did not, I regret it. The Minister of 
Public Works and the Minister of Electricity have been here, 
both of whom are experts in their field. The Minister of 
Agriculture is an agronomist, the Minister of Water Resources a 
water hydrologist. These are people who really know what they 
are doing. They do not just have a Ph.D. in some theoretical 
field, they have expertise in their ministries.
    There are four remaining steps. The fourth step is writing 
a constitution. We hope that the Iraqi Governing Council will 
move quickly to convene a constitutional convention to write 
that constitution.
    The fifth step is ratifying that constitution. The sixth 
step will follow that ratified constitution with free 
democratic elections. And the seventh step will be when we, the 
Coalition Authority, can transfer all sovereignty back to an 
elected democratic Iraqi Government. And I might add, Mr. 
Chairman, nobody looks more forward to that day than I, except 
perhaps my wife.
    Some, including some members of the Iraqi Governing 
Council, have suggested we should give full sovereignty to an 
Iraqi Government immediately or very soon. Mr. Chairman, I 
firmly belief that moving fast, too fast, would be a mistake, 
not because I am anxious to hold onto sovereign, on the 
contrary. But we must remember that Iraq has spent a quarter 
century under a dictatorship as absolute and abusive as that of 
Nazi Germany. And I like to remind my historian friends that 
Saddam Hussein was in power three times as long as Hitler, 
three times as long as Hitler.
    As a result, political distortions and inequities permeate 
the fabric of Iraqi political life. No appointed government, 
even one as honest and dedicated as the Iraqi Governing 
Council, can have the legitimacy necessary today to take on the 
difficult issues Iraqis face, as they write a constitution and 
elect a government. The only path to full Iraqi sovereignty is 
through a written constitution ratified and followed by free 
democratic elections. Shortcutting the process would be 
dangerous.
    As you examine the President's plan, I am sure you will see 
that it is an integrated and thoughtful whole. Every part 
depends on every other part. And as Congress knows, sweeping 
political reforms cannot be separated from sweeping economic 
reforms. It is equally obvious that a population beleaguered by 
the threat of terrorism and endless insufficiencies in water, 
electricity, and telephones finds it hard to concentrate on the 
virtues of a new constitution and market-oriented economic 
polices.
    The need to protect the coalition and the populace alike 
against terrorists and common criminals is obvious and 
indispensable. And all of this, Mr. Chairman, requires the help 
of Congress. The United States must take the lead in restoring 
Iraq as a friend and a democratic model. As you mentioned, 
there is a Donors Conference coming in Madrid October 23 and 
24. And we must set the example for other countries' goodwill. 
Other nations who do not wish to see Iraq become a terrorist-
supporting tyranny or a landscape of factions must help us. We 
set an example and work with other donors to avoid the near 
anarchy in which terrorists feel right at home.
    When we launched military operations against Iraq, we 
assumed a great responsibility that extended beyond defeating 
Saddam's military. We cannot simply pat the Iraqis on the back, 
tell them they are lucky to be rid of Saddam, and then ask them 
to go find their place in a global marketplace. To do so would 
invite economic collapse followed by political extremism.
    If, after coming this far, we turn our backs and let Iraq 
collapse into factional chaos, some new tyranny or terrorism, 
we will have committed a grave error. Not only will we have 
left the long-suffering Iraqi people to a future of danger and 
deprivation, we will have sown the dragon's teeth, which will 
sprout more terrorists and eventually cost more American lives.
    Make no mistake, Mr. Chairman, these requested funds 
represent an investment in America's national security. You may 
think I exaggerate. But I ask you to look at what happened in 
Afghanistan, another country which, after it was debilitated by 
decades of war and mismanagement, became easy prey to the 
Taliban and al-Qaeda.
    The reconstruction of Iraq may seem distant to Americans 
today. Eight time zones and two continents separate the East 
Coast of the United States from Iraq; and of course, the West 
Coast is effectively half a world away.
    Two years ago, on September 11, terrorists brought their 
threat home to us. From a faraway corner of the world, they 
showed us that we must fight terrorism globally. Iraq only 
seems far away. Today, Iraq is a focal point of our global war 
on terrorism. Failure there would strengthen terrorists morally 
and materially.
    Success will tell Iraqis--not just Iraqis but the world, 
that there is hope and that the future is not defined by 
tyranny on one side and terrorism on another. As Mr. Biden 
said, we must succeed.
    Mr. Chairman, members of the committee, I respectfully ask 
Congress to honor the President's supplemental request. And I 
look forward to answering your questions.
    The Chairman. Well, thank you very much, Ambassador.
    [The prepared statement of Ambassador Bremer follows:]

    Prepared Statement of Hon. L. Paul Bremer, III, Administrator, 
                    Coalition Provisional Authority

    Mr. Chairman and members of the committee, thank you for this 
opportunity to discuss the President's supplemental request.
    Before I begin, I want to pay tribute to the men and women of our 
armed services. Leading a coalition, our armed forces delivered a 
military victory without precedent.
    In roughly three weeks they liberated a country larger than Germany 
and Italy combined. And they did so with forces smaller than the Army 
of the Potomac.
    Our armed forces accomplished all this while absorbing and 
inflicting minimal casualties. Iraqis understood that we tried to spare 
the innocent. After the first days of the war, only those citizens of 
Baghdad living close to obvious targets feared our bombing.
    Mr. Chairman, I know that you and all Americans hate waking up to 
hear a newscast that begins, ``Last night another American soldier was 
killed in Iraq . . . .''
    My day starts eight hours ahead of yours. I am among the first to 
know of those deaths and no one regrets them more than I do.
    But these deaths, painful as they are, are not senseless. They are 
part of the price we pay for civilization, for a world that refuses to 
tolerate terrorism and genocide and weapons of mass destruction.
    Those who ambush Coalition forces, like those responsible for 
recent terror bombings and those who ambushed Governing Council member 
Aquila al-Hashimi last Saturday, are trying to thwart constitutional 
and democratic government in Iraq. They are trying to create an 
environment of insecurity.
    They will win some battles, but they are losing the war with 
history.
    President Bush's vision, in contrast, provides for an Iraq made 
secure through the efforts of Iraqis. In addition to greater security, 
the President's plan provides for an Iraqi economy based on sound 
economic principles and bolstered by a reliable infrastructure. And 
finally, the President's plan provides for a democratic and sovereign 
Iraq at the earliest reasonable date.
    If we fail to recreate Iraq as a sovereign democracy sustained by a 
solid economy we will have handed the terrorists a gift.
    Terrorists love state sponsors, countries that provide them with 
cash, arms, refuge, and a protected place to rest and plan future 
operations. Saddam's Iraq was one of those countries. Remember the Rome 
and Vienna airport massacres of 1985? The architect of those massacres, 
Abu Nidal, lived out his days under Saddam's protection. Similarly, Abu 
Abbas, the architect of the Achille Lauro hijacking and the murder of 
Leon Klinghofer, lived in Baghdad for years as an honored guest.
    When terrorists cannot find a congenial state sponsor, they seek 
environments with little or no effective government. When militias, 
warlords and communities war with each other, terrorists are right at 
home. Think of Lebanon in the 1980s.
    Either outcome, or some combination of both, is possible in Iraq if 
we do not follow up on our military victory.
    The opposite is also true. Creating a sovereign, democratic, 
constitutional and prosperous Iraq deals a blow to terrorists. It shows 
you can have freedom and dignity without using truck bombs to slaughter 
the innocent. It gives the lie to those who describe us as enemies of 
Islam, enemies of the Arabs and enemies of the poor. That is why the 
President's request has to be seen as an important element in the 
global war on terrorism.
    Our national experience teaches us how to consolidate a military 
victory.
    We did not have that experience 85 years ago when we emerged 
victorious from World War I. Many had opposed the war. As a nation, we 
wished to shake the old world dust off our boots and solve problems at 
home. We had spent and lent a lot of money. The victors celebrated 
their victory, mourned their dead and demanded the money they were 
owed.
    We know the results of that policy. Extremism, bred in a swamp of 
despair, bankruptcy and unpayable debts, gave the world Fascism in 
Italy and Nazism in Germany.
    The result was another World War. After that conflict we showed we 
had learned that military victory must be followed by a program to 
secure the peace. In 1948 our greatest generation recognized that 
military victory was hollow if democracy was not reinforced against 
tyranny. Democracy could not flourish unless Europe's devastated 
economies were rebuilt.
    That generation responded with the boldest, most generous and most 
productive act of statesmanship in the past century--the Marshall Plan. 
Winston Churchill called it ``the most unsordid act in history.''
    When Secretary of State George C. Marshall first described the 
Marshall Plan he laid out some truths that resonate today.
    ``Its purpose,'' Marshall said, ``should be the revival of a 
working economy . . . so as to permit the emergence of political and 
social conditions in which free institutions can exist.''
    Highlighting the importance of approaching the issues at the 
highest levels, Marshall said, ``Any assistance that this government 
may render in the future should provide a cure rather than a mere 
palliative.''
    The Marshall Plan, enacted with overwhelming bipartisan support, 
set war-torn Europe on the path to the freedom and prosperity which 
Europeans enjoy today. After a thousand years as a cockpit of war 
Europe became a cradle of peace in just two generations.
    The grants to Iraq the President seeks bespeak a grandeur of vision 
equal to the one which created the free world at the end of World War 
II. Iraqis living in freedom with dignity will set an example in this 
troubled region which so often spawns terrorists. A stable peaceful 
economically productive Iraq will serve American interests by making 
America safer.
    There are some things I would like to point out about this billion 
request:

   We have a definite plan with milestones and dates.

   No one part of the supplemental is dispensable and no part 
        is more important than the others. This is a carefully 
        considered request.

   This is urgent. The urgency of military operations is self-
        evident. The funds for non-military action in Iraq are equally 
        urgent. Most Iraqis welcomed us as liberators and we glowed 
        with the pleasure of that welcome. Now the reality of foreign 
        troops on the streets is starting to chafe. Some Iraqis are 
        beginning to regard us as occupiers and not as liberators. Some 
        of this is inevitable, but faster progress on reconstruction 
        will help.

      Unless this supplemental passes quickly, Iraqis face an 
        indefinite period with blackouts eight hours daily. The link to 
        the safety of our troops is indirect, but real. The people who 
        ambush our troops are small in number and do not do so because 
        they have undependable electric supplies. However, the 
        population's view of us is directly linked to their cooperation 
        in hunting down those who attack us. Earlier progress gives us 
        an edge against the terrorists.

   We need to emulate the military practice of using 
        overwhelming force in the beginning. Incrementalism and 
        escalation are poor military practice and they are a poor model 
        for economic assistance.

   This money will be spent with prudent transparency. Every 
        contract of the $20 billion for Iraq will be competitively bid.

   That the money be granted and not loaned is essential. 
        Initially, offering assistance as loans seems attractive. But 
        once again we must examine the facts and the historical record. 
        Iraq has almost $200 billion in debt and reparations hanging 
        over it as a result of Saddam's economic incompetence and 
        aggressive wars. Iraq is in no position to service its existing 
        debt, let alone to take on more. Mountains of unpayable debt 
        contributed heavily to the instability that paved Hitler's path 
        to power. The giants of the post-World War II generation 
        recognized this and Marshall Plan assistance was overwhelmingly 
        grant aid.

    The President's first priority is security, security provided by 
Iraqis to and for Iraqis. That security extends to our forces and 
changes Iraq from a logistics and planning base for terrorists into a 
bulwark against them.
    The President envisions three pillars of security

   Public safety--police, border enforcement, fire and a 
        communications system to link them.

   National defense--a new army and civil defense system.

   Justice system--courts and prisons.

    This security assistance to Iraq benefits the United States in four 
ways.
    First, Iraqis will be more effective. As talented and courageous as 
the Coalition forces are, they can never replace an Iraqi policeman who 
knows his beat, who knows his people, their customs, rhythms and 
language. Iraqis want Iraqis providing their security and so do we.
    Second, as these Iraqi security forces assume their duties, they 
replace Coalition troops in the roles that generate frustration, 
friction and resentment--conducting searches, manning check points, 
guarding installations.
    Third, this frees up Coalition forces for the mobile, sophisticated 
offensive operations against former regime loyalists and terrorists for 
which they are best suited.
    Finally, these new Iraqi forces reduce the overall security demands 
on Coalition forces and speed the day when we can bring troops home.
    Security is the first and indispensable element of the President's 
plan. It is not, by itself, sufficient to assure success because a 
security system resting only on arms is a security system that will 
fail. Recreating Iraq as a nation at peace with itself and with the 
world, an Iraq that terrorists will flee rather than flock to, requires 
more than people with guns.
    A good security system cannot persist on the knife edge of economic 
collapse. When Saddam scurried away from Coalition forces he left 
behind an economy ruined not by our attacks but by decades of neglect, 
theft and mismanagement.
    Imagine the effect on the economy of operating without a budget for 
a quarter-century. Saddam, who came to power in 1979, never prepared a 
national budget. Ill-conceived and clumsily executed policies left Iraq 
with:

   an oil industry starved nearly to death by underinvestment,

   thousands of miles of irrigation canals so weed-clogged as 
        to be almost useless, and

   an electrical system that can at best meet only two-thirds 
        of demand.

    Reflect, if you will, on that last item. As millions of American 
households (including the Bremer household) have learned in recent 
days, it is almost impossible to live in the modern world without 
dependable electricity. Think of what we would be asking of Iraqis were 
we to suggest they fashion a new economy, a new democracy, while 
literally in the dark eight hours per day.
    The Iraqis must refashion their economy. Saddam left them a Soviet-
style command economy. That poor model was further hobbled by cronyism, 
theft and pharonic self-indulgence by Saddam and his intimates.
    Important changes have already begun.
    The Iraqi Minister of Finance on Sunday announced a set of market-
oriented policies that is among the world's boldest.
    Those policies include:

   A new Central Bank law which grants the Iraqi Central Bank 
        full legal independence, makes price stability the paramount 
        policy objective, gives the Central Bank full control over 
        monetary and exchange rate policy, and broad authority to 
        supervise Iraqi banks. This is rare anywhere in the world and 
        unique in the region.

   The Iraqi Governing Council proposed, and on Thursday I 
        signed into law, a program opening Iraq to foreign investment. 
        Foreign firms may open wholly owned companies or buy 100 
        percent of Iraqi businesses. Under this law foreign firms 
        receive national treatment and have an unrestricted right to 
        remit profits and capital.

   Tariff policy is equally simple. There is a two-year 
        ``reconstruction tariff'' of five percent on all but a few 
        imports.

   Foreign banks are free to enter Iraq and will receive equal 
        treatment with Iraqi banks.

   On October 15, Iraq will get a new currency, the New Dinar, 
        which will float against the world's currencies.

    Iraq's pro-growth policies should bring real, sustained growth and 
protect against something we have all seen and regretted--economic 
assistance funds disappearing into a morass of poverty.
    The Iraqi Government has put in place the legal procedures for 
encouraging a vibrant private sector. But those policies will come to 
nothing if Iraq must try to reestablish itself on an insufficient and 
unreliable electric grid or in a security environment that puts a stick 
in the spokes of the wheels of commerce.
    Iraq cannot realize its potential to return quickly to the world 
stage as a responsible player without the services essential to a 
modern society.
    We have made significant progress restoring these essential 
services. The widely predicted humanitarian crisis did not occur. There 
was no major flow of refugees. All of Iraq's 240 hospitals and 90 
percent of its health clinics are open. There is adequate food and 
there is no evidence of epidemic. We have cleared thousands of miles of 
irrigation canals so that fanners in these areas have more water than 
they have had for a generation. Electrical service will reach pre-war 
levels within a month.
    However, the remaining demands are vast, which is why most of the 
President's request for non-military assistance is for infrastructure 
programs.
    On another front there is already good news. The democratization of 
Iraq, on which so much global attention is focused, is further advanced 
than many realize.
    Encouraging a quick political transformation, we have laid out a 
clear, seven-step process leading to sovereignty. Three of the seven 
necessary steps have been completed:

          1. An Iraqi Governing Council, the most broadly 
        representative governing body in Iraq's history, was appointed 
        in July.

          2. In August the Governing Council named a Preparatory 
        Committee to determine the mechanism for writing Iraq's new, 
        permanent constitution.

          3. Earlier this month the Governing Council appointed 
        ministers to run the day-to-day affairs of Iraq.

          4. The fourth step is writing a constitution, which sets the 
        framework for all that follows. This will occur after the Iraqi 
        Governing Council decides how to act on the recommendations of 
        the Preparatory Committee. The constitution will be written by 
        Iraqis.

          5. The constitution will be ratified by popular vote of the 
        entire adult population. This will give Iraq its first 
        popularly approved constitution.

          6. After the constitution's ratified, elections for a new 
        government will be held.

          7. The final step will come after elections, when we transfer 
        sovereignty from the Coalition to the new government.

    Some, including members of the Iraqi Governing Council, suggest we 
should give full sovereignty to an Iraqi government immediately or very 
soon. I firmly believe that such haste would be a mistake. Iraq has 
spent a quarter century under a dictatorship as absolute and abusive as 
that of Nazi Germany. As a result, political distortions and inequities 
permeate the fabric of political life.
    No appointed government, even one as honest and dedicated as the 
Iraqi Governing Council, can have the legitimacy necessary to take on 
the difficult issues Iraqis face as they write their constitution and 
elect a government. The only path to full Iraqi sovereignty is through 
a written constitution, ratified and followed by free, democratic 
elections. Shortcutting the process would be dangerous.
    As you examine the President's plan I am sure you will see that it 
is an integrated and thoughtful whole. Every part depends on every 
other part. As the Congress knows, sweeping political reforms cannot be 
separated from sweeping economic reforms.
    It is equally obvious that a population beleaguered by the threat 
of terrorism and endless insufficiencies in water, electricity, and 
telephones finds it hard to concentrate on the virtues of a new 
constitution and market-oriented economic policies.
    The need to protect the Coalition and the populace alike against 
terrorists and common criminals is obvious and indispensable.
    All of this requires the help of Congress.
    The United States must take the lead in restoring Iraq as a friend 
and democratic model. There is a donor conference in Madrid in late 
October. We must set the example for other nations of goodwill. Other 
nations who do not wish to see Iraq become a terror-supporting tyranny 
or a landscape of factions. We set an example and work with other 
donors to avoid the near anarchy in which terrorists will feel right at 
home.
    When we launched military operations against Iraq we assumed a 
great responsibility that extends beyond defeating Saddam's military.
    We cannot simply pat the Iraqis on the back, tell them they are 
lucky to be rid of Saddam and then ask them to go find their place in a 
global market--to compete without the tools for competition.
    To do so would invite economic collapse followed by political 
extremism and a return to terrorism.
    If, after coming this far, we turn our backs and let Iraq lapse 
into factional chaos, some new tyranny and terrorism, we will have 
committed a grave error.
    Not only will we have left the long-suffering Iraqi people to a 
future of danger and deprivation, we will have sewn the dragon's teeth 
which will sprout more terrorists and eventually cost more American 
lives.
    You may think I exaggerate. I ask you to look at what happened in 
Afghanistan, another country which, after it was debilitated by decades 
of war and mismanagement became easy prey for the Taliban and al Qaida.
    The reconstruction of Iraq may seem distant from American concerns 
today. Eight time zones and two continents separate the East Coast of 
the United States from Iraq. The West Coast is effectively half a world 
away.
    Two years ago on September 11, terrorists brought their threat home 
to us. From a far-way corner of the world, they showed us that we must 
fight terrorism globally.
    Iraq only seems far away. Today Iraq is a focal point in our global 
war on terrorism. Failure there would strengthen the terrorists morally 
and materially.
    Success tells not just Iraqis, but the world that there is hope, 
that the future is not defined by tyranny on one side and terrorism on 
the other.
    Mr. Chairman and members of the committee we respectfully ask 
Congress to honor the President's supplemental request, which responds 
to urgent requirements in order to achieve the vision of a sovereign, 
stable, prosperous and democratic Iraq at peace with us and with the 
world.
    Mr. Chairman, I welcome your questions.

    The Chairman. I want to ask that the committee on the first 
round have 7 minutes each. We have a number of members present 
and others may arrive later. We hope we will not have 
interruptions. We will have a second round with time remaining 
at that point.
    Let me commence the questions, Mr. Ambassador, by----
    [Disturbance from a member of the audience.]
    The Chairman. Will the gentleman please just leave 
peacefully, so we can continue with the hearing? We would 
appreciate that.
    [Pause.]
    The Chairman. Ambassador Bremer, essentially the plan for 
democracy that you have pointed out is an important one. As for 
the timing, you have offered a rationalization. Let me just ask 
this: Essentially, as the cabinet members have been appointed, 
the Governing Council is involved. You pointed out the 
essential aspect of getting the lights on 24 hours a day. This 
involves huge investments in infrastructure. The reconstruction 
moneys we are involved in are a large part of that.
    Likewise, I appreciate the announcement of the end of the 
command economy and the announcement of market economic 
reforms, which are really quite bold and very new, really, for 
the Iraqi economy. They have just come into being and may, in 
fact, provide a remarkable change, not only in Iraq but for 
that matter in the entire area, as would, in fact, a 
functioning democracy. It would be a first.
    As we shared, Senator Biden, Senator Hagel, and I were 
there with you at the Dead Sea Conference, the World Economic 
Forum. We heard the Arab League people asking, where is 
democracy? There is not one. So this would be the first market 
economy.
    Now, the problem that I perceive here, quite apart from how 
the $200 billion of debt is to be disposed of--and that is a 
very important issue--what would happen, in your judgment, to 
the democratic process, to the market economic reforms, to the 
fledgling civil liberties that are being fashioned, if in fact 
the advice was taken? You administrators were there, working 
with this Iraqi Governing Council and cabinet
    I heard at the U.N. on Monday that some are suggesting 
immediate delegation of sovereignty to the Governing Council. 
An appealing thought, really, to some countries in the world 
that find the American presence to be difficult and that would 
like to see us leave or to mitigate very substantially your 
authority. Just as a practical matter, how do we get to 
reforms? And are they likely to be successful in the long run? 
Is this a dream that is beyond the possibilities? Or do you 
really see a plan over a period of time, a timeframe in which 
these economic reforms, quite apart from the political ones, 
might happen and might bring a new and vibrant Iraq, preferably 
debt free, so that the moneys that taxpayers now in this 
country are being asked to pour into the country are not 
recycled out by some other authority, fulfilling debts of the 
past?
    Can you give us some feel for this?
    Ambassador Bremer. Well, Mr. Chairman, it is always easier 
to state the process than to implement it. Moving Iraq from 35 
years of tyranny to democracy will not be easy, which is why we 
believe the path must be carefully followed out. It need not be 
slow but it needs to be taking place in the framework of a 
clear, legal, and political process. And that process must 
involve writing a constitution.
    Our country, of all countries in the world, understands the 
value of a permanent constitution. And after all, it took us 12 
years to get it right. So, we do not believe that passing power 
to an unelected group early on will be sustainable in the long 
run. And that is why we think the path, as I said, must pass 
through a constitution.
    This can be done. It will take time. It need not take a 
great deal of time. It can be done, the whole process can be 
done, as quickly as the Iraqis can, in fact, write the 
constitution.
    It is more or less the same process on the economic 
reforms; though there, I think, progress can be more rapid. 
These laws, which I signed into effect a week ago, take effect 
from the date I signed them, at least the foreign direct 
investment law does. The tariff rate goes in on the first of 
the year.
    There is no reason now, other than the quite understandable 
concern about security, why firms cannot begin now to invest in 
Iraq. And indeed, that is already happening. As you and your 
delegation saw, when you moved around the country, there has 
been an explosion of economic activity at the street level in 
every city in the country. Thousands of stores have opened up. 
One of my favorite indicators of the market working was when 
satellite dishes were first offered for sale about 2 weeks 
after I got there; they cost $150, the street price today is 
down to $45. So, it is about a third what it was; the market is 
working.
    So, I do not underestimate the difficulty of making the 
transition in political and economic reform. But I am 
optimistic and I am confident the Iraqis can do it. They are a 
competent, serious group of people.
    The Chairman. Let me ask about a grimmer subject. What 
about the problem of suicide bombers, people with suicidal 
tendencies? For the moment, we talk about our security forces 
dealing with the remnants of Saddam or the Baathist party who 
are still at war. But people in Iraq have conducted attacks on 
the U.N. again, on a prominent Shiite cleric, and now on Iraqi 
police officers. These are not American targets. Is there a 
possibility for a fledgling Iraqi democracy to contend with 
this form of terrorism? I would not say this is a new 
phenomenon but, nevertheless, the suicidal aspects of it are 
worrisome. Many have commented on a very horrible tendency and 
wonders whether these people are Iraqi or from anywhere else. 
They seek to wreak havoc on the reconstruction process and on 
the effort to rebuild confidence in democracy and institutions.
    Well, what feel do you have as to how we are to work 
through the suicide bomber situation, regardless of who the 
bombers are and where they are coming from?
    Ambassador Bremer. You are quite right, Mr. Chairman. The 
suicide bombing is new, although not entirely new. We did face 
some suicide bombings during the military operations. So, it is 
not as if it has not happened in Iraq. But certainly the weight 
of evidence would suggest that suicide bombers are probably not 
Iraqis. They probably are terrorists coming from outside the 
country, though we do not at the moment have clear evidence of 
that.
    The Iraqis are going to have a difficult time with 
security. And one of the reasons that $5 billion of the $20 
billion that I am here to talk about is dedicated to security, 
is precisely to give the Iraqis a better capability themselves 
in police and in an army and in a court and prison system to 
deal effectively with criminals, whether they are terrorists or 
criminals. It is going to be a difficult job but we think they 
can handle it.
    The Chairman. I have just about exhausted my time. And I 
should not infringe upon the time of others. Let me say again, 
I appreciate your report. What I am hopeful for is that we can 
get much more adequate information here in the committee all of 
the time. I am not certain where the blocks are. This is one 
reason why your personal appearance is extremely important. It 
is always so informative.
    You have friends here. We need information for the debate, 
the discussion, in our own country. You have already commented 
upon the difficulties of getting the word to Iraqis. That is 
another entire subject but an important one, and we would like 
to be helpful.
    So please, as the plans are formulated, as you make 
speeches, statements, and what-have-you, make certain that your 
friends here distribute those to our committee members, because 
we would like to receive that information in a timely way.
    Ambassador Bremer. We will do that.
    The Chairman. Senator Biden.
    Senator Biden. Thank you.
    I suspect that you have gotten a sense, as I said in my 
opening statement, of apprehension that is being evidenced by 
Members of Congress in both parties. The polling data that was 
read, relative to the attitude of the Iraqi people, could be 
overlaid with the polling data of the attitude of the American 
people. The American people have gone from thinking this was a 
great idea to not such a good idea to now 59 percent of the 
American people, if my memory is correct, in a poll yesterday 
saying we should not appropriate this money.
    The reason I mention that to you is not to suggest the 
basis upon which we should make our decisions. But you should 
understand that time is not on our side. Time is not on our 
side. As the guy behind you, Mr. Korologos knows--and he knows 
this place better than anybody I know, and I mean that 
sincerely, when things go south here, they go south quickly.
    And so there needs to be, in my view, an incredibly 
sensitized sense of urgency here. And that takes to this sort 
of straw man the French have put up and this notion of Iraqi 
sovereignty. The implication the French make is that somehow we 
do not intend on turning over sovereignty to the Iraqis. We 
know, everybody here knows, that is our desire for 50 different 
reasons.
    But the reason I mention this is that I want to focus on 
one aspect of the plan as an illustration of what I believe to 
be the lack of a sense of urgency and the lack of a willingness 
of the administration to go beyond your pay grade, what needs 
to be done; and that is that restoring a sense of security on 
the street to average Iraqis.
    Walt Slocombe, who is one of the most competent guys in the 
entire defense establishment, told us, all your folks who were 
first rate told us stories of Iraqis, even though the schools 
are open, being fearful of letting their daughters go to school 
for fear of kidnaping, waiting outside till their daughters 
come out so they can take them home.
    Yet we met with Mr. Kerik, who was the former commissioner 
of New York City, and a really first-rate team of people who 
have vast experience in Kosovo and Bosnia and Afghanistan, 
about how to train the Iraqi police force. As we were told 
then, several months ago, it would take up to 5 years to train 
the Iraqi police force, which really was not a police force. 
These guys did not even know how to go on patrol. The idea that 
there was an Iraqi police force was a myth.
    And what you had is a group of Iraqis who had uniforms, and 
they did not know how to do investigative work. They took care 
of traffic. If people did not show up, Saddam sent someone and 
killed them. I mean, it was real simple. So we are really 
training from the bottom up here.
    And we were told there was a need for 5,800 European 
carabinieri in there immediately. You got 300 from the 
Italians, another 400 somewhere along the way. In my 
discussions with Dr. Rice, in my discussions with the 
Secretary, in all of my discussions, there was no sense of 
urgency of going out there and banging on doors, dragging 
people out to train these Iraqis.
    Now we have enough trainers that we could train--if my 
numbers are correct and I think they are--full bore; if we 
want, we can train roughly 250 Iraqi police--is it a month?--
per month, based on the trainers we have.
    Just real practical here. Why have we not made a deal? Why 
have we not gone out of our way? Why have we not--or maybe you 
have made the request--said, look, we will pay a premium. I 
mean, hell we are paying Iraqis who are not working. We are 
paying Iraqi military folks who were getting paid before and 
are not doing a damn thing. Why not put out the word we need 
1,000 American cops to get these people trained? What is the 
deal here? Where is the practical input of how to get this 
done? This is not rocket science. Why? Why have we not done 
those kinds of things?
    Ambassador Bremer. Well, thank you for those questions, 
Senator. In fact, there is a great sense of urgency. We do have 
a plan. We have--I told Mr. Kerik and his colleagues that we 
could not wait 5--actually, it was 6 years. It was 5.9 years, 
his plan, to get us to a police force of 80,000, which is what 
we need.
    We now have about 40,000 police on duty. They are former 
policeman and therefore of questionable utility in the long 
run, which is why each of them is being put through a refresher 
course that teaches them, among other things, human rights and 
respect for the law.
    We have a plan to produce another 40,000. There is $2 
billion in this supplemental for it. It is one of the single 
largest pieces in this supplemental. And the plan is to train 
those people in Jordan. We plan to start training the trainers 
in 3 weeks. We will----
    Senator Biden. How many?
    Ambassador Bremer. We will train----
    Senator Biden. How many trainers do you have?
    Ambassador Bremer. We are going to need 1,500 trainers. The 
State Department has identified 1,000 trainers. We are ready to 
move on those as soon as we get the money. We, under this 
plan----
    Senator Biden. Where are we going to get those trainers?
    Ambassador Bremer. They are being--through a contractor 
here in Washington.
    Senator Biden. So, they are going to be American trainers?
    Ambassador Bremer. American. But we are also--we have 
received offers form the Czech Republic, the British, the 
Italians. I saw another cable this morning, I cannot remember 
which country; there are lots of places.
    Senator Biden. Roughly, what is the total of the European 
contribution? We were told by the folks running the training 
facility they needed 5,800 European cops.
    Ambassador Bremer. No. We have reduced that number by 
running it in a different way. We are down to a 1,500 need. And 
we will get the 1,500. That is not going to be the problem. 
Here is the problem. Even going as fast as we can, and we will 
train 25,000 new police in a year, just to put that in 
perspective, Mr. Kerik, who ran the largest training facility 
anywhere in the world, at a maximum trained 6,000 police in a 
year. We are going to be training four times as many as have 
ever been trained anywhere in the world in a year. That is a 
sense of urgency, I can tell you. And there is $2 billion in 
here that makes that happen.
    Senator Biden. Well, the sense of urgency is that you need 
trainers. This is something I do know a little about, chairing 
Judiciary for years and writing the crime bills and working 
with Kerik and all these mayors across the country and all 
these training programs. You cannot send these guys out by 
themselves. What they need is to send out competent police 
officers from other countries with the Iraqi police.
    Ambassador Bremer. That is right. That is the plan.
    Senator Biden. These guys are a joke. These guys are a 
joke.
    Ambassador Bremer. That is the plan. The plan is that they 
do joint patrols.
    Senator Biden. Well, I will come back to that point and 
others. Thank you.
    The Chairman. Thank you very much, Senator Biden.
    Senator Hagel.
    Senator Hagel. Mr. Chairman, thank you. Mr. Chairman, I 
have a statement that I would ask to be included in the record.
    The Chairman. It will be included in the record in full.
    Senator Hagel. Thank you.
    [The prepared statement of Senator Hagel follows:]

               Prepared Statement of Senator Chuck Hagel

    Thank you, Mr. Chairman, for holding this hearing on the next steps 
in Iraq. These hearings are playing a critical role in helping 
Americans understand the challenges that we face in Iraq, and the 
resources and sacrifices that will be required for success.
    I would also like to thank Ambassador Bremer, our witness today, as 
well as his colleagues at the Coalition Provisional Authority in Iraq, 
and our men and women in uniform for their service, commitment, and 
sacrifice in Iraq.
    The Bush administration's $87 billion supplemental appropriations 
request was a wake-up call for many Americans who expected only 
cheering crowds and flowing oil after Iraq's liberation. The first 
phase of the war in Iraq is over, but the peace is not yet won. Peace 
and stability in Iraq will not come easy, and it will not come cheap.
    Americans are asking tough questions about the nature and cost of 
our commitments in Iraq. What are the trade-offs that we must consider 
to pay for Iraq's reconstruction? Furthermore, the Department of 
Defense reports that 80 Americans have died as a result of hostile 
engagements in Iraq, and many more wounded, since President Bush 
declared an official end to major hostilities on May 1. Many Americans 
do not understand why Americans are still dying in a liberated country.
    If these questions are not answered, we may lose a domestic 
consensus at home that is necessary to stay the course in Iraq.
    Yesterday, President Bush addressed the future of Iraq at the 
United Nations. He asked for the support of the United Nations to help 
the U.S. rebuild Iraq. We must internationalize our efforts in Iraq. It 
is in the interests of all nations that we are successful in Iraq. 
Peace and stability in Iraq and the Middle East are in the interest of 
the world. America must share the decision-making responsibilities, as 
well as the burdens, in Iraq. If Iraq becomes a failed state, a haven 
for terrorists and the intrigues of its neighbors, the world loses.
    Rebuilding Iraq's economy is essential for a stable and hopefully 
democratic transition in Iraq, and by extension, for peace and 
stability in the Middle East. I support the administration's request 
for $20.3 billion for Iraq's reconstruction, and I share Ambassador 
Bremer's sense of urgency. But a window may be closing in Iraq. Our 
time is short, and there is little margin for error.
    There will be no economic windfall in Iraq in the near term. Iraq 
is a broken, indebted economy, with a devastated infrastructure and an 
estimated 60% unemployment rate. If Iraq's economy falters, the 
political transition will also pay a high price. Stability and 
democracy are not assured.
    Iraq needs the help of the international community. Iraq's foreign 
debt is estimated to be $70-$120 billion. The international community 
must provide immediate and generous debt relief for Iraq to have a 
chance for a democratic future. Oil revenues through December 2005 are 
projected to be only $33.3 billion. My own back of the envelope 
calculation is that even with the additional $20.3 billion supplemental 
appropriations that the President has requested for Iraqi 
reconstruction, and in the absence of significant international 
support, we will fall at least $25-$50 billion short over the next few 
years of the projected reconstruction costs in Iraq.
    There is common ground on Iraq for a new UN Security Council 
Resolution. America and its allies want Iraq to be governed by Iraqis 
as soon as it is feasible. America and its allies want an expanded role 
for the United Nations. This must happen. The international legitimacy 
that a unified UN brings to our efforts in Iraq cannot be overstated.
    Mr. Chairman, I welcome the opportunity you have provided for 
Ambassador Bremer to discuss in greater detail the administration's 
plan for Iraq's future.

    Senator Hagel. Ambassador Bremer, welcome. I add my thanks 
to you and your civilian colleagues, as well as our military, 
our men and women in uniform, who are making sacrifices for 
this country. We appreciate it. And please relay our thanks as 
you return.
    I suspect you have broken, or will break, some kind of a 
record up here this week. I do not know of anyone who will have 
testified to as many formal committees and hearings as you will 
by the end of the week. So, thank you for that; and I know you 
were asked to do more. But I do not know. Is it nine that you 
have----
    Ambassador Bremer. Well, six formal hearings and several 
other less formal appearances.
    Senator Hagel. Semi-formal hearings.
    Senator Biden. That is not bad for $87 billion, though.
    Ambassador Bremer. I am not complaining, Senator; I am just 
stating the facts.
    Senator Hagel. You understand this business, why it is 
important to have you here, as you have worked your way through 
some of those hearings and will continue, because it is 
critical that the American people understand what the point is 
here. One of the concerns many of us have, I know you have, is 
not just losing an international consensus but losing a 
national consensus for the objective that we have ahead of us. 
So, you are as critical a person in this national/international 
debate as anyone; so, thank you.
    Before I ask a couple of questions, I thought your 
testimony was good. And it was to the point. I would add one 
piece to your reflections on what happened after World War II. 
And I happen to agree with your assessment. The additional 
component that I would include in your Marshall Plan analysis 
and why we started to get things right after World War II was 
that after World War II, as you know, other important things 
were done. And that is that we set up coalitions of common 
interest. The United Nations was formed. NATO was formed. 
Bretton Woods brought IMF/World Bank, the general agreement on 
tariffs and trade.
    And what was the point of that? The point of that, of 
course, the world had common interests. We should share 
responsibilities for those common interests. We should develop 
forums to exchange our interests, our differences, and work 
them out.
    So, I would add that as another reason why we have been 
successful the last 58 years, certainly under American 
leadership. But let us not eliminate the United Nations and 
other of these multilateral organizations that have been so 
important to keep relative peace and prosperity in a dangerous 
world.
    The United Nations, the President's speech yesterday, I 
said that I appreciated very much him going before the United 
Nations. I have said also that I think he could have been more 
specific in specific areas of requests for assistance from 
United Nations allies.
    And could you give us some detailed definition this 
morning, Mr. Ambassador, as to where you would envision our 
allies, the United Nations, could play specific roles, their 
roles of responsibility, in helping restructure and rebuild 
Iraq? Included in that would be what decisionmaking 
responsibilities authority are you willing to give up, are we 
willing to give up, if we are to enlist specific allies, as 
well as the United Nations, and fore-structures and money and 
training and all that would come with that?
    So, that is the one thing I have not heard much about from 
you, the President, or the Administration. Thank you.
    Ambassador Bremer. Thank you, Senator. And I will convey 
your thanks to my colleagues when I return.
    Senator Hagel. Thank you.
    Ambassador Bremer. I think the administration's policy on 
the question of having international support has been all along 
that we welcome it. I am sure members of the committee are 
familiar with the fact that it is already a broadly 
international effort. We have troops from 30 other countries on 
the ground with us.
    Senator Hagel. But we are paying for most of that.
    Ambassador Bremer. Well, it is the price of being the 
world's super power.
    Senator Hagel. But, I mean, let us be honest about it, Mr. 
Ambassador. We are paying for most of it. I am interested, if 
we are going to go after United Nations' help and allies' help, 
the big allies, what are we prepared to do in the way of 
sharing responsibilities, decisionmaking authority?
    You and I both know the facts of life here. These people 
are not going to turn over troops to you, General Abizaid, or 
money, or resources without some say in this; and they should 
have some. And then it gets back to a question I have been 
asking: Why should this country bear all the burden, or 
certainly 90 percent of that burden, when it is in the interest 
of all the world to stabilize the Middle East? So what are we 
willing to give up in the way of sharing?
    Ambassador Bremer. Well, I think on the--I see it as two 
separate questions. On the question of the troops, I think 
there is broad agreement that we must retain unity of command 
and that the country with the largest contributors of troops 
should remain in charge of those troops. As I understand it, 
though I am not intimately involved in the negotiations in New 
York over a new Security Council resolution, so I cannot 
comment in detail on that, but I understand that--that 
particular concept seems to be understood.
    So, there does not seem to be any contention over that 
question. I would argue that the same has to apply on the 
question of reconstruction. There must be some unity of 
command. We cannot have people pulling right and left, which is 
why I established a Coalition International Committee, which 
was established under the former Polish Deputy Prime Minister 
Marek Belka, in July, to be available to coordinate the efforts 
that are coming in. And there are 61 countries that are already 
contributing to Iraq's reconstruction, to make coordination, so 
we do not have two countries, for example, wanting to build a 
hospital in the same city or three people trying to build the 
same school.
    So, we already have a mechanism due to that coordination. 
Whether, at the end of the negotiations in New York, we find a 
different mechanism for that coordination, I have to basically 
leave to the negotiations in New York and to the way the 
administration is going to come up with this new resolution. 
The President made clear, back at the time of the war and 
after, and he said it again yesterday that we certainly foresee 
a vital role for the United Nations--he specified several areas 
yesterday--in helping write the constitution and helping 
conduct the elections.
    I have had visitors from the United Nations already helping 
the Iraqis figure out how do voter registration; these are 
things we welcome. Nobody is saying the U.N. does not have a 
role.
    And the same goes for other countries. We have welcomed 
them in. And we will have to see now, in terms of your question 
of authority, how the discussions in New York go over the next 
weeks.
    Senator Hagel. Thank you.
    The Chairman. Thank you very much, Senator Hagel.
    Senator Sarbanes.
    Senator Sarbanes. Thank you, Mr. Chairman.
    Ambassador Bremer, I think this is the first time you have 
appeared before this committee, I believe, since taking on 
these responsibilities.
    Ambassador Bremer. Yes, sir; that is correct.
    Senator Sarbanes. Yes. You have had a distinguished career 
in the Foreign Service. As I understand it, you left it, 
retired in 1989, and then became a managing director of 
Kissinger Associates, and then were--I do not know whether you 
continued that right up until you were called back into the 
government.
    Ambassador Bremer. No, sir.
    Senator Sarbanes. But this is your first return back to 
government; is that correct?
    Ambassador Bremer. Well, yes; although I was chairman of 
the National Commission on Terrorism. You will remember, 
Senator, I appeared before this committee----
    Senator Sarbanes. Yes, I recall that.
    Ambassador Bremer [continuing]. In that respect.
    Senator Sarbanes. I recall that.
    Ambassador Bremer. And I served on the President's Homeland 
Security Advisory Council; both of those were non-paid 
government service.
    Senator Sarbanes. Yes. Now, you are the Administrator of 
the Coalition Provisional Authority; is that correct?
    Ambassador Bremer. Yes, sir.
    Senator Sarbanes. Who constitutes the Coalition Provisional 
Authority?
    Ambassador Bremer. Who makes it up?
    Senator Sarbanes. Yes.
    Ambassador Bremer. What is it made up of?
    Senator Sarbanes. Yes.
    Ambassador Bremer. It is made up of representatives of the 
coalition. I have on my staff people from 17 different 
countries who help me with the job of administering Iraq while 
we continue to exercise sovereignty there.
    Senator Sarbanes. When the Coalition Provisional Authority 
makes a decision, I take it that is your decision; is that 
correct?
    Ambassador Bremer. Well, less and less. Because we now 
have, since July 13, we have a Governing Council. And since 
September 2, we have Iraqi ministers. So, more and more 
decisionmaking is effectively collaborative since July.
    Senator Sarbanes. But the ultimate decisionmaking is yours; 
is it not?
    Ambassador Bremer. I would put it this way: The ultimate 
authority is the coalition's but the decisionmaking is 
essentially done in co-determination with relevant Iraqis. The 
authority, as a legal matter, rests with the coalition.
    Senator Sarbanes. And, therefore, rests with you?
    Ambassador Bremer. That is right.
    Senator Sarbanes. Because in the end you make the decision 
for the coalition. I mean, it is a one-man show in that regard; 
is it not?
    Ambassador Bremer. No, it is not a one-man show. I have two 
very senior British diplomats, who work literally side by side 
with me as the----
    Senator Sarbanes. And if you and they disagree, what is the 
outcome?
    Ambassador Bremer. Well, actually, that has not happened 
yet. So, I----
    Senator Sarbanes. If it should happen, what would be the 
outcome?
    Ambassador Bremer. Well, I imagine there would be 
discussions between London and Washington?
    Senator Sarbanes. I understand that. But assuming no 
consensus can be achieved, how is that decision made?
    Ambassador Bremer. Well, in the end----
    Senator Sarbanes. I mean, if you are the ultimate 
decisionmaker----
    Ambassador Bremer. Yes. In the end----
    Senator Sarbanes [continuing]. Why do you not say you are 
the ultimate decisionmaker?
    Ambassador Bremer. In the end, I have, as you said, the 
authority.
    Senator Sarbanes. All right. Now, the supplemental request 
from the Executive Office of the President has $65 billion for 
the Department of Defense?
    Ambassador Bremer. That is right.
    Senator Sarbanes. And then it has a heading, Coalition 
Provisional Authority and Department of State, $21.4 billion. 
And then they say the request provides $20.3 billion for the 
Iraq relief and reconstruction fund for use by the Coalition 
Provisional Authority. Then the small balance is for the State 
Department.
    You basically will make the decision on the use of that 
money; is that correct?
    Ambassador Bremer. No. As a matter of fact, the $20 billion 
supplement which is before the Congress was developed by the 
Iraqi ministries, the related ministries, Minister of 
Electricity, Ministry of Water Resources, Ministry of 
Agriculture, and so forth, in conjunction with my experts. It 
was put together basically to meet----
    Senator Sarbanes. Well, will the money go to the ministry 
to be--and the expenditure of the money then be decided by the 
minister?
    Ambassador Bremer. It will be implemented by the 
ministries.
    Senator Sarbanes. Well, who will decide the use of the 
money?
    Ambassador Bremer. Well, the American Congress is being 
asked to decide on the $20 billion. It will then----
    Senator Sarbanes. We decide on the big amount and sub 
amounts. But when that money goes out, $5 billion, $3 billion 
for this purpose----
    Ambassador Bremer. Right.
    Senator Sarbanes [continuing]. Who is going to decide how 
that money is going to be spent?
    Ambassador Bremer. That will be decided by me, by the 
Coalition Provisional Authority in conjunction with the plan 
that has already been put together with the Iraqi ministries.
    Senator Sarbanes. So, you are the decisionmaker on the use 
of that money.
    Ambassador Bremer. Yes.
    Senator Sarbanes. Now, do you expect to be the 
Administrator a year from now?
    Ambassador Bremer. That is a--I serve at the pleasure of 
the President, Mr. Sarbanes.
    Senator Sarbanes. No, no, no. I am not suggesting that. 
That is not the path I am going down. I am trying to find out 
how long you think we are going to need an administrator and a 
Coalition Provisional Authority.
    Ambassador Bremer. I understand.
    Senator Sarbanes. Do you expect that a year from now you 
will no longer be in place?
    Ambassador Bremer. Well, it goes back to the question about 
when the coalition's authority, the sovereignty that we 
exercise under international law now, is passed to a sovereign 
Iraqi Government.
    Senator Sarbanes. I understand that. And I understand the 
steps you have laid out and so forth. All I am trying to get is 
the timeframe, do you expect a year from now that you will 
still be the Administrator?
    Ambassador Bremer. Well, what I was trying to explain, 
Senator, is that depends on how quickly the Iraqis write a 
constitution.
    Senator Sarbanes. Well, I understand that.
    Ambassador Bremer. And I do not know how quickly----
    Senator Sarbanes. If it takes them a long time to write it, 
I take it you would still be the Administrator 5 years from 
now?
    Ambassador Bremer. Right, or somebody would be.
    Senator Sarbanes. If it takes them a short period of time 
to write it, you would be the Administrator, you would be out 
of there in 3 months. What do you expect? And I give you a 
time. Do you expect that a year from now you will still be the 
Administrator?
    Ambassador Bremer. I think that it is quite possible that 
the Iraqis will go down that path and have elections sometimes 
next year. The Foreign Minister----
    Senator Sarbanes. Now a year from now, of course----
    Ambassador Bremer. The Iraqi Foreign Minister is----
    Senator Sarbanes. A year from now is next fall, the fall of 
2004. Do you expect U.S. military forces will still be in Iraq 
at that point?
    Ambassador Bremer. Yes.
    Senator Sarbanes. And furthermore, do you expect that U.S. 
military forces will be there after there is no longer an 
administrator and a Coalition Provisional Authority?
    Ambassador Bremer. In answer to your first question, I do 
expect American forces to be there in a year. In answer to your 
second question, I really do not know. The Iraqis, when they 
have their own sovereign government, will do what every 
government does. They will assess their security needs and they 
will decide whether they need outside help for their security. 
And if they do, they presumably will assign some kind of a sofa 
agreement with America, if they want American forces there.
    Senator Sarbanes. What is your expectation on how long 
American forces will continue to be in Iraq?
    Ambassador Bremer. Well, my guess is it will be beyond next 
year.
    Senator Sarbanes. How far beyond?
    Ambassador Bremer. I really do not know.
    Senator Sarbanes. Could I ask just one quick question?
    Are you attending the International Donors Conference in 
Madrid at the end of October?
    Ambassador Bremer. Yes, sir.
    Senator Sarbanes. What are your expectations for that 
conference?
    Ambassador Bremer. Well, we are hoping that the 
international community, other countries, and the international 
financial institutions, like the World Bank and the IMF, will 
make substantial contributions, will agree to make substantial 
contributions to the recovery of Iraq. As Senator Sarbanes 
pointed out, the World Bank assessment is that they need 
something like $60 billion to $70 billion; and that we have 
focused on the $20 billion that we think needs to be spent 
quickly over the next 12 to 18 months. And a lot of that other 
$60 billion is in the out-years. And we are hoping that we are 
going to find substantial contributions to that from the Donors 
Conference.
    Senator Sarbanes. If we do not, does it then fall upon us 
to provide them money?
    Ambassador Bremer. No, I do not think so, Senator. If one 
looks at the Iraqi budget, by the year 2005, if we get oil 
production back to three million barrels a day, which we expect 
to do by October of next year, the Iraqi revenue stream should 
be in excess of the needs of the immediate running of the 
government by about $5 billion a year. So, the Iraqi Government 
should be spinning off substantial amounts that they can put 
into these less urgent investments that the World Bank says 
need to be made.
    Senator Sarbanes. Well, I will pursue that in my second 
round.
    The Chairman. Thank you very much, Senator Sarbanes.
    Senator Chafee.
    Senator Chafee. Thank you very much, Mr. Chairman.
    From what I understand, you left Baghdad and came here and 
got Isabel and lost your electricity here; so, you cannot win.
    Ambassador Bremer. No.
    Senator Chafee. I admire and appreciate the sacrifices you 
are making.
    In your prepared statement, you did give us a history 
lesson of post-World War I and the reparations that might have 
led to the rise of Nazism and the Marshall Plan. But what does 
amaze me--and then Senator Hagel, a little more of the history 
of the formation of the United Nations. But what does amaze me 
that the entire Bush administration seems to have missed the 
lessons of Vietnam. And now we do find ourselves mired in a 
land in which we do not share a nationality, the ethnicity, the 
religion, the language of the people of where we find 
ourselves. But that is where we are and now we wrestle with 
that.
    And my question is: As we go through the process of forming 
a constitution, having a democracy, what is the plan, if the 
people of Iraq want to elect an anti-American, anti-Western, 
Iranian-style theocracy, or whatever it might be? Is there that 
possibility? And is there a plan to have some parameters in the 
constitution to deal with that?
    Ambassador Bremer. Well, first, my assessment is that--that 
is not a very likely outcome but it is certainly a serious 
question. We have said that we believe it is important for the 
constitution to be written by Iraqis.
    On the other hand, there will be certain major issues--one 
of them will be the role of religion--on which we will want to 
be absolutely certain that some fundamental principles are 
respected, in particular the freedom of worship. And we have 
made that clear. And I do not anticipate that being a problem 
in the constitution.
    Senator Chafee. Are you confident that--that is not a 
possibility?
    Ambassador Bremer. No. I said----
    Senator Chafee. Are we deluding ourselves at all?
    Ambassador Bremer. No, I do not think so. From our 
discussions, both mine, but more importantly by experts in the 
field, from what little polling data there is available, there 
was a poll that was cited earlier in which fewer than 33 
percent of the people in Iraq want even an established 
religion. Although, incidentally, Islam was established in the 
previous constitution.
    So, we do not look at it through rose-colored glasses. We 
do not diminish it. I am just giving you my assessment at this 
time.
    Senator Chafee. If there were to be some charismatic 
ayatollah that got involved in the political process, is there 
going to be some aspect to the constitution that forbids some 
kind of anti-American, anti-Israel, anti-Western government?
    Ambassador Bremer. Well, I would--I do not know the answer 
to that, Senator, until--they have not even convened the 
constitutional convention yet. I can understand what the 
American interest is. And you may be sure we will make our 
interests known. But I cannot give you an assessment. I do not 
consider those to be likely outcomes at this point. But the 
constitutional convention has not even been convened yet.
    Senator Chafee. OK. Thank you. And now we are here asking 
for a large amount of money. And the big question I am hearing 
from my constituents is: What is the security going to be for 
our investment that we are potentially going to be making in 
wastewater, water projects, electricity, obviously the oil 
pipelines that run across large unpopulated regions of the 
country? How are we going to secure this? How easy is it going 
to be for guerrillas to sabotage our investment?
    Ambassador Bremer. We will continue to have good days and 
bad days, as I said in my testimony. I do not pretend that we 
have the security situation solved. That is why $5 billion of 
this $20 billion is dedicated to doing those things, making 
better border police.
    In the Iraqi budget itself, not in this supplemental but in 
the Iraqi budget itself, we have put aside funds for the oil 
ministry to stand up a police force dedicated to protecting oil 
pipelines. We have given the electricity ministry money to 
stand up a force to protect the power lines.
    But there are 19,000 kilometers of power lines in Iraq and 
there are 7,000 kilometers of pipelines. You cannot guard 
everything all the time everywhere. So there will be continued 
acts of sabotage. But those acts of sabotage are falling off 
now, as the two ministers pointed out in their statements in 
the Oval Office on Monday. And we are beginning to see the 
power generation coming up.
    Oil production, the day before yesterday, was a record 1.9 
million barrels. It is the highest it has been since 
liberation. And it is on an upward curve.
    So again, I am not being Pollyanna. We will have bad days. 
We will have more sabotage. But the trend is in our favor.
    Senator Chafee. Yes. I might question that trend myself. 
The President of Indonesia was saying that she is seeing a 
rise, as a result of the war in Iraq, a rise of extremism. And 
this is a rallying place for extremists to go, common sense 
would tell you, and that it is going to get more and more 
difficult to secure our investment.
    Ambassador Bremer. Well, I said in my----
    Senator Chafee. Can you comment on the President of 
Indonesia's comments, this war in Iraq is----
    Ambassador Bremer. I did not hear her comments.
    Senator Chafee [continuing]. Working against our----
    Ambassador Bremer. I did not hear her comments. But I make 
no secret in my opening comments that Iraq has become a major 
front of the war on terrorism. It is not a very comfortable 
position for me or my colleagues to be in. It is dangerous but 
it is a fact.
    Senator Chafee. Very good. Once again I, on a personal 
level, admire what you are doing.
    Ambassador Bremer. Thank you.
    The Chairman. Thank you very much, Senator Chafee.
    Senator Feingold.
    Senator Feingold. Thank you, Mr. Chairman and Senator 
Biden, for calling this hearing today.
    And Ambassador Bremer, I do thank you for being here. I am 
glad to have an opportunity to be a part of a concrete 
discussion about where we stand in Iraq and where we are going. 
I appreciate the fact that you, and your staff, and many Iraqis 
are working very hard in this difficult transition in Iraq; and 
you are right to point out the gains that have been made thus 
far.
    But I have to tell you, echoing, I think, at least what 
Senator Hagel seemed to be saying, that based on what has 
transpired to date, many of my constituents have lost or are 
losing confidence in our policy and I share a great deal of 
their skepticism.
    Now, we are being asked to invest tens of billions of 
additional dollars in a scheme that has not earned our 
confidence without a clear sense of when the demands on the 
American might cease, both in terms of manpower and money. So, 
it seems to me that rather than just making the case for why 
reconstruction is important, the administration also needs to 
tell us what is going to change in terms of our efforts to date 
and how we will take action to place our policy on a firmer 
footing.
    In that regard, I would like to sort of ask the converse of 
a question that Senator Hagel was asking you. What kinds of 
decisionmaking authorities do you currently possess that you 
would be unwilling to share, you think would be a bad idea to 
share with other donors in the context of seeking their 
vigorous support and participation in the reconstruction 
effort? What can we not credibly give up?
    Ambassador Bremer. Well, I think there are two answers to 
that. One of them is that I do not think we can relinquish the 
concept of an orderly turnover of the political authority. That 
is not directly--the question you asked was reconstruction but 
I think it is relevant.
    That is to say, I believe that we must stay on the path of 
insisting that there is a constitutional framework followed by 
democratic elections before there is full sovereignty returned 
to the Iraqi people. It may be that there will be other 
countries who will agree with us on that. But I am just saying 
I think that concept must be protected.
    Senator Feingold. But I am asking vis-a-vis the donors.
    Ambassador Bremer. Yes.
    Senator Feingold. I recognize that is an answer vis-a-vis 
the Iraqis.
    Ambassador Bremer. Yes.
    Senator Feingold. But vis-a-vis the donors, what powers 
that are now being exercised by the United States in your 
authority would you be unwilling to give in return for help 
form the other donors?
    Ambassador Bremer. Well, I would be unwilling to give to 
other countries the authority on deciding how to spend the $20 
billion that the taxpayers of America are putting up.
    Senator Feingold. Let me ask you a different question. 
Ambassador Bremer, in July, Deputy Secretary of Defense 
Wolfowitz suggested that it was difficult to imagine before the 
war that the criminal gang of sadists and gangsters who have 
run Iraq for 35 years would continue fighting, fighting what is 
sometimes called a guerrilla war.
    In fact, why we would have anticipated anything else is 
something of a mystery to me. And then on Monday, in testimony 
before the Appropriations Committee, you indicated that the 
administration has been surprised by the influx of terrorists, 
who now present a threat to Americans on the ground in Iraq. 
But President Bush told the Nation several weeks ago that ``the 
surest way to avoid attacks on our own people is to engage the 
enemy where he lives and plans. We are fighting that enemy in 
Iraq and Afghanistan today so that we do not meet him again in 
our own streets, in our cities.''
    So which one is it, Ambassador? Did we fail to anticipate 
these attacks or is this all part of the President's overall 
plan to engage the enemy in Iraq? It really cannot be both.
    Ambassador Bremer. Well first, analytically, those are two 
separate things. The question of the former regime loyalists 
attacking us is not the same as the point I made on Monday 
about foreign terrorists. They are two different problems. They 
may start to come together. That is a concern of mine. But in 
terms of the former regime loyalists, I think what happened 
was--and again, I am now speaking only from what I have been 
able to learn because, as Senator Biden pointed out, I was 
actually not even in government at the time of the war.
    But what seems to have happened is that a large number of 
very bad people in the Fedayeen Saddam, in the Republican 
Guards, and in the intelligence agency simply faded away. They 
were not ever militarily defeated. And this is particularly 
true in the area to the west of Baghdad, north to Tikrit, which 
is where 80 percent of the attacks against coalition forces are 
coming. They simply faded away. They did not stand and fight. 
They did not stay in barracks and surrender. They simply melted 
back into the landscape.
    This, I think, was not foreseen, so I understand, by the 
planners. And that has been a problem for us. In terms of the 
terrorists, what has happened, the arrival of the foreign 
terrorists is a relatively new phenomenon. That is to say, it 
dates basically back to sort of early July or so, early to mid-
July. And what happened there was, the Ansar Islam terrorists, 
whom we hit in the beginning of the war in the north, those who 
survived went into Iran. They spent time licking their wounds 
and reconstituting and started infiltrating back into Iraq, as 
I mentioned in early to mid-July. And that is a----
    Senator Feingold. So essentially, when the President says 
we have to engage the enemy where he lives, when you are 
speaking of these people, you are speaking of people who just 
really recently arrived, that are just living in Iraq now.
    Ambassador Bremer. Well, yes. But again, if you want to 
talk about the terrorists, one has to then make----
    Senator Feingold. Yes. I want to understand how a place, 
that was not obviously the focus of the war against terrorism, 
somehow became the central focus of the war on terrorism, and 
who is responsible for making it a hotbed of terrorism?
    Ambassador Bremer. Well, the terrorists are, of course.
    Senator Feingold. Well, I really question this notion that 
we advanced our position vis-a-vis the war against terrorism by 
providing them with an opportunity they apparently did not have 
before, by your own admission----
    Ambassador Bremer. No.
    Senator Feingold [continuing]. That these people were not 
there.
    Ambassador Bremer. No. I am sorry.
    Senator Feingold. That is what you just indicated.
    Ambassador Bremer. I am sorry, Senator.
    Senator Feingold. You indicated those terrorists were not 
there.
    Ambassador Bremer. Let me correct the record here. Iraq was 
a state sponsor of terrorism for 20 years.
    Senator Feingold. State sponsor of terrorism?
    Ambassador Bremer. It was on the list of state sponsors of 
terrorism.
    Senator Feingold. Right.
    Ambassador Bremer. And it was--I mentioned several of the 
most obvious cases, in terms of Abu Nidal and Abu Abbas. There 
are, as the Director of the Central Intelligence has testified, 
clear intelligence connections, clear evidence of intelligence 
connections between al-Qaeda and Saddam's regime. We did not 
invent terrorism in Iraq. There was a terrorist regime there 
before.
    Senator Feingold. Mr. Chairman, I'll just conclude by 
saying this is the same road that the White House went down in 
the beginning by trying to patch together a few different 
anecdotes that may or may not have related to somebody, that 
may or may not have some connection to a group, that may or may 
not be connected to al-Qaeda. And the President had to actually 
admit the other day that there was no such connection.
    I fear that this same approach is being used here, as well; 
that yes, there are terrorists around the world, and in each 
case it should be condemned. But not all terrorists are part of 
this particular network that attacked our country on September 
11. And I do not think it serves the American people to simply 
lump all this together as if it is one problem and one issue. 
Because the fact is the group that we need to deal with most is 
the al-Qaeda organization. And I do not think this policy is 
necessarily dealing with that.
    Ambassador Bremer. But Senator, let me just correct the 
record on something you said about the President. If I 
understood what the President said was, he said that there was 
not a connection between Saddam Hussein and September 11.
    Senator Feingold. Right.
    Ambassador Bremer. He did not say that there was no 
connection between terrorism and Saddam.
    Senator Feingold. No, I agree with that.
    Ambassador Bremer. I just want to correct the record.
    Senator Feingold. What I am indicating is that the American 
people in polling believed, at the time of the invasion of 
Iraq, that Saddam Hussein was involved in 9/11. So what I am 
suggesting is, the sloppiness in this regard is unfair to the 
American people. And I think there was a deliberate attempt to 
make the American people believe that somehow there was this 
connection.
    Now, maybe the President himself believed that there was 
this connection at the time. And I am very concerned about the 
American people having believed that there was some connection 
and then the President admitting that there was not. What I am 
suggesting looking forward is let us be sure, when we start 
talking about terrorism and what is happening, who is coming 
into Iraq right now, that we are as careful as we can be about 
identifying who these people are and not making the American 
people assume that they are exactly the same people who were 
involved with 9/11.
    They may well be. But I think we have to be terribly 
careful, because the credibility here is getting quite 
strained.
    [The prepared statement of Senator Feingold follows:]

           Prepared Statement of Senator Russell D. Feingold

    I thank Chairman Lugar and Senator Biden for calling this hearing 
today, and Ambassador Bremer, I thank you for being here. I am 
certainly glad to have an opportunity to engage in a concrete 
discussion about where we stand in Iraq and where we are going.
    Ambassador Bremer, I appreciate the fact that you and your staff 
and many Iraqis are working very hard on this difficult transition in 
Iraq. And you are right to point out the gains that have been made thus 
far. But I must tell you, that based on what has transpired to date, 
many of my constituents have lost or are losing confidence in our 
policy. I share a great deal of their skepticism. Now we are being 
asked to invest tens of billions of additional dollars in a scheme that 
has not earned our confidence without a clear sense of when the demands 
on the American people might cease, both in terms of manpower and 
money. One of the most compelling arguments for this supplemental as a 
whole--the need to provide critical resources to the young men and 
women who were called to serve in Iraq--also compels us to insist on 
clarity and sound, realistic thinking in this reconstruction process.
    So it seems to me that rather than just making the case for why 
reconstruction is important, the administration also needs to tell us 
what is going to change in terms of our efforts to date, what is going 
to improve, and how and when that is going to happen. This 
administration needs to take stock of what is not working, what is 
alienating potential allies and what is fostering suspicion within the 
Iraqi population, and then take action to place our policy on a firmer 
footing. I want more than a status report and more than a sales job. I 
want to see a responsible way forward that is free of self-delusion and 
wishful thinking.

    The Chairman. Thank you very much, Senator Feingold.
    Senator Allen.
    Senator Allen. Thank you, Mr. Chairman. Thank you for your 
insightful leadership and that of Senator Biden and my 
colleagues.
    And I thank you, Ambassador Bremer, and that of your 
family, also, for your steady, patient leadership in 
transforming Iraq, which was clearly a state sponsor of 
terrorism on a variety of fronts, maybe not directly with al-
Qaeda all the time.
    When I mentioned your family, you think of what he would 
do, giving a father or mother $25,000 if their son or daughter 
would have one of those suicide murders in Israel.
    I want to be supportive of the administration's request for 
Iraq and Afghanistan. And I agree with the concepts and the 
logic and the sequential steps that you want to take in 
formulating the sovereignty of Iraq from this dictatorship. And 
I understand the urgency. That is, there is an urgency for the 
safety of our troops, indirectly and directly, and also the 
path to a government, a civil government, in Iraq.
    There has been a lot of analogies here, historical 
analogies; World War I and World War II, the Marshall Plan. We 
are not following exactly. I do not think we are talking about 
partitioning Iraq and establishing a French sector, a U.S. 
sector, British sector, and certainly never make the mistake of 
giving something to the Soviet Union, since they no longer 
exist. But we remember how long it took to reunify Germany.
    In looking at the $21 billion--let us say $20 billion, for 
Iraq, the different aspects of it, I understand the diplomatic 
reasons why we cannot get paid back on the oil. Maybe for the 
police, they cannot put court fees and filing fees and so forth 
to pay for the judicial system. But when one gets to the issues 
of $6 billion for basic electricity service, $4 billion for 
water and sanitation services, in our country, people pay for 
those. They are bonded. They are paid for by the electricity 
users and the water users.
    The argument is made that these cannot be made into loans. 
The main argument is because Iraq is saddled with $200 billion 
of debt to various countries. Now as we use post-World War II 
analogies, they were debts clearly that Mussolini's Fascist 
government in Italy had; certainly Nazi Germany had debts, and 
Imperial Japan. I do not think any of those debts were paid 
off.
    So when you say that we cannot obligate in some way very 
favorable interest rates, maybe in an International Monetary 
Fund or some multinational group providing low interest or no 
interest loans for some of that water or electricity 
infrastructure, the argument is that they cannot pay that $200 
billion debt. And it just strikes me if Saddam's dictatorship 
is compared to Hitler, why in the heck should the Iraqi people 
be burdened with paying off that $200 billion debt? And 
especially since that is used as a reason for the American 
taxpayers not to potentially be paid off in a country that will 
have wealth and will eventually establish a much stronger 
economy in the years to come.
    So, could you answer for me or share with us your views, 
Mr. Ambassador, on why that $200 billion debt, or any portion 
of it incurred by Saddam's tyrannical government, ought to be 
paid off and why there cannot be some way, creatively working 
together, where Americans and others who may want to pitch in 
and contribute to some multinational group that provides loans 
for, say, water and sewer and electricity in Iraq could get 
paid off over maybe many, many decades?
    Ambassador Bremer. Well, thank you, Senator. It is a 
thoughtful question. It is a question, really, of timing. I 
think that certainly most Iraqis that I have talked to, the 
Governing Council, ministers, believe that much of the debt 
that was incurred and which now lies on their shoulders is 
odious, was instituted by a tyrannical regime. And they feel 
very little sympathy with the idea of having to pay it back.
    They feel even more strongly about the reparations, which 
represents about half of this $200 billion roughly; because the 
reparations, of course, are owed to neighboring countries that 
were victims of Saddam's aggression.
    These are important and difficult questions which are 
already being discussed. As you may know, the G-7, in its 
meetings in Evian in June, agreed that there would be a tolling 
of the debt servicing for a year and a half to allow the 
international community a year and a half to figure out what to 
do about Iraqi debt; and we encourage that process.
    And I think in the end there should be a substantial 
reduction in the real value of Iraq's debt. But that process 
will take, at a minimum, another year and a half. That is the 
deadline that they have given themselves. And if you look at 
previous debt rescheduling, you will see that even a year and a 
half is very optimistic.
    We do not have a year and a half, Senator. That is why we 
have asked for an urgent amount of money to get us through the 
next year and a half. This $20 billion is those projects which 
we think are essential for American security and to allow the 
Iraqis to get the kind of economic infrastructure, essential 
services, security forces they need now.
    Senator Allen. I understand the urgency, and agree with it. 
I am not going to pursue the point. I would like to work with 
you, though, and find out a way if we can make this a loan. Let 
me follow up on Senator Chafee's point on the elections being 
next year, which means that they first need to have a 
constitution. They do not have the concepts that we had as we 
developed ours, with states having--like Virginia's, the 
statute of religious freedom. The key to me is individual 
rights----
    Ambassador Bremer. Rights.
    Senator Allen [continuing]. Regardless of Islamic. People's 
rights should not be enhanced nor diminished on account of 
their religious beliefs. Do you see any potential George Masons 
or James Madisons or Ben Franklins there? And when do you 
suspect it likely to have a constitutional convention begin, so 
they can sort through some of these very fundamental human 
rights issues to hopefully be inculcated as part of their 
constitution, protecting individual rights, as opposed to 
religious rights or group rights?
    Ambassador Bremer. Well, one of the hopeful signs is that 
the Iraqi opposition groups, which met before the war in London 
and met after the war several times in Iraq, and the Governing 
Council in its initial political statement, all of them 
endorsed protection of individual rights. And I am optimistic, 
which is why when Senator Chafee asked the question about a 
religious theocracy, I am optimistic that they have got this 
message very clearly, that individual rights must be 
acknowledged and preserved in whatever constitutional system 
they come up with.
    We will certainly insist on it. It is a fundamental red 
line for us. Individual rights, women's rights, civil liberties 
must be recognized.
    Now, when will the convention start? I do not know. The 
preparatory committee, which was the second of the seven steps 
I have outlined, was appointed and has been asked to report 
back to the Governing Council on the process by which the 
conventional conference will be pulled together, been asked to 
report back by next Tuesday, at which point the Governing 
Council will have to decide how do we get this conference 
started and what kind of deadline to give them to write the 
constitution.
    So hopefully, in the next month or so, we should have 
better visibility into the question that many people are 
asking, which is what is the timing of this all going to be. I 
have insisted to the Governing Council that when they convene 
the conference, they should give them a deadline, get the 
constitution written by a date fixed. Pick your date, April 1, 
April 15. Pick a date. But there should be a deadline.
    Senator Allen. Thank you, Mr. Ambassador.
    Thank you, Mr. Chairman.
    The Chairman. Thank you very much, Senator Allen.
    Let me just mention, in terms of business management of the 
hearing now, the Ambassador must leave promptly at noon for 
another obligation. And we have four Senators left to speak. 
There is ample time for them to be heard and for them to ask 
their questions with maybe a few minutes left over. But I ask 
everybody to respect the time, so that all Senators can be 
heard.
    Senator Boxer.
    Senator Boxer. Thank you so much, Mr. Chairman. And thank 
you for holding this important hearing.
    Senator Sarbanes. Mr. Chairman, is it your intention to 
bring the Ambassador back?
    The Chairman. No, it is not my intention. He is not going 
to be available again to the committee.
    Senator Sarbanes. So it is just a one-shot appearance?
    The Chairman. That is correct.
    Senator Boxer. Can I ask that you reset that clock? Because 
I have a lot to say in 5 minutes.
    The Chairman. Yes. We will start again with Senator Boxer.
    Senator Boxer. Senator Sarbanes has a good way of getting 
to the heart of the matter. We have a lot of things to say. So, 
I will cut to the chase.
    I want to back everything you said, Ambassador, about our 
men and women in uniform. They are brave and courageous. And a 
lot of them are my constituents. A lot of them who died were my 
constituents. And I just want to read a little portion of a 
letter from a mother of a soldier, who is over there now, from 
Fort Bragg, California.
    She writes, ``This has been the worst possible nightmare 
for a mother. There are many days that I completely fall apart 
and lose control. I can't take it another day. This is killing 
me. I'm going crazy and at times feel suicidal. This is the 
worst kind of torture. I can't function. I can't go to work. I 
can't focus. I can't sleep or eat. I'm a mess. I can't go 10 
seconds without thinking about my son. My life is on hold until 
he returns. Please get our troops replaced ASAP, whatever it 
takes.''
    So I think that sense of where are we going, are we making 
the improvements that we need to make over there is very real 
with our people.
    Now, Mr. Ambassador, your job is to rebuild Iraq. And by 
the way, thank you for taking this on. And as I told you 
yesterday, I pray for your safety and for your return home as 
soon as possible. And my job is a little different than your 
job. On behalf of my constituents, it is to make this country 
all it can be.
    And I believe we have obligations abroad. That is why I 
went on this committee. I think we need to do what we can do 
for others. It is part of my upbringing. I could tell you one 
thing, though, after we were attacked on our homeland on 9/11, 
I am ready and willing to be obsessed about getting Osama bin 
Laden and al-Qaeda.
    But I do not think that our obligations in Iraq should turn 
into an obsession. What we hear about from the President is, 
and very eloquently, rebuilding Iraqi schools, hospitals, 
prisons, even building a witness protection program, a long-
term military intervention, to quote the President, ``as long 
as it takes.'' And my people, frankly, are perplexed.
    This administration is so focused on this Iraq situation 
but they will not pay for it. The administration, at the same 
time, will not fully fund our education bill, ``No Child Left 
Behind.'' We cannot even build our roads and transit systems. 
Here is--I sit on this committee, too. Delay of the road bill 
will cost the states. That is what happened yesterday, folks. 
We cannot find the money here to build the roads.
    The deficit is soaring. I am sure you know it is going to 
be $500 billion. By the way, if you take away the Social 
Security trust fund, it is $700 billion. It is dangerously 
irresponsible. And my people were interested that you were 
thrilled that the top tax rate in Iraq is 15 percent. And they 
roll their eyes. They are paying to rebuild Iraq, and their top 
tax rate is 15 percent, $87 billion on top of $70 billion 
already. And their top tax rate is 15 percent.
    So I am telling you, Mr. Ambassador, that my people, 
Democrats, many Republicans and Independents alike, they want 
an exit strategy, not 5-year, not a 10-year, not as long as it 
takes. They want an exit strategy.
    Now, in your report to us, you said that 80 percent of the 
country or thereabouts was secure, 80 percent of the country. I 
have heard Donald Rumsfeld talk about it is 90 percent of the 
country. But let us say, you are on the ground there every day, 
80 percent.
    If 80 percent of the country is safe, why not go to that 80 
percent of the country, get in the U.N. peacekeepers under U.S. 
control in terms of military? Then in the troubled areas, only 
20 percent of the country, you say, let us ease the burden on 
our troops, call in our allies to help us there. And if the 
price of these two steps is sharing the decisions on contracts 
in rebuilding Iraq, then I think we ought to do it.
    I heard Senator Biden say, on TV awhile ago, that this 
administration has been acting as if Iraq was a prize. Well, my 
people do not see it as a prize. They are beginning to see it 
as a prize for Haliburton. And that is very unfortunate, 
because they do not want any of our soldiers put in jeopardy 
for that.
    Now, my people feel for the Iraqi people and they want to 
do their share. But they were told it would be quite a 
different ending to this war. And who can blame them? Let us 
quote Ari Fleischer: ``While the reconstruction costs remain an 
issue for the future,'' he said, this was 2/18/03, ``and Iraq, 
unlike Afghanistan, is a rather wealthy country, Iraq has 
tremendous resources that belong to the Iraqi people. And there 
are a variety of means that Iraq has to be able to shoulder 
much of the burden for their own reconstruction.''
    Paul Wolfowitz, 3/27/03, ``There is a lot of money to pay 
for this that doesn't have to be taxpayer money. And it starts 
with the assets of the Iraqi people. We're dealing with a 
country that can really finance its own reconstruction and 
relatively soon.''
    And on 3/27/03, Secretary Rumsfeld, ``I don't believe the 
U.S. has the responsibility for reconstruction, in a sense. 
Reconstruction funds can come from those various sources I 
mentioned, frozen assets, oil revenues, a variety of other 
things, including `Oil for Food,' which has a substantial 
number of billions of dollars in it.''
    So my people at home, they remember these things. These are 
very charismatic people who spoke to them. You know, Donald 
Rumsfeld, Ari Fleischer, Wolfowitz; charismatic, lots of 
attention. They read what they said. And now they are saying to 
me: Senator, before you give them a blank check, you had better 
know what you are doing. Because they have been given promises 
that have not come through.
    Yes, a brilliant military campaign. But this administration 
was wrong on weapons of mass destruction, wrong on what would 
happen after the war, wrong on what it would cost to rebuild 
Iraq, wrong on how many troops would be needed, wrong on oil 
revenues, wrong on how much other countries would contribute. 
And now my constituents are saying, watch out, given this 
history and given what we need at home.
    So, I know my time is almost over. I have one small 
question on procurement, because I wrote the amendment with 
John Warner that said no single--no closed bids here. We want 
open bids, no sole source contracting. And I notice you made a 
little subtle change in your testimony. As it was written, you 
said that ``this money will be spent with prudent transparency. 
Every contract of the $20 billion for Iraq will be 
competitively bid.'' That is your written statement.
    Then you added ``at least what I'm in control of.'' So I 
guess that gets the question that Senator Sarbanes was asking. 
What are you not in control of over the $20 billion, or can we 
expect that every contract will be competitively bid for that 
$20 billion?
    Ambassador Bremer. You can expect that every contract for 
the $20 billion will be competitively bid. What I meant was, 
you are looking at an $87 billion supplemental, $66 billion of 
which I am not responsible for.
    Senator Boxer. Well, in closing, let me say again thank 
you. And I hope you will think about what I mentioned about the 
80 percent of the country versus 20 and maybe think a little 
bit out of the box as to how we can draw down these resources 
and share the responsibility with others.
    Ambassador Bremer. Well, Senator, it is a very good point. 
And one of the things we are trying to do to answer that is to 
give the Iraqis, as quickly as we can, more responsibility for 
their own security. That is why there is $2 billion in the 
supplemental to speed up the training of the Iraqi police, so 
it does not take 6 years, it takes a year and a half, and why 
there is $2 billion in here to speed up the training of the 
Iraqi army, so that it takes 1 year instead of two.
    Senator Boxer. That does not answer my--it is OK, it is 
fine.
    The Chairman. Thank you very much, Senator Boxer.
    Senator Brownback.
    Senator Brownback. Thank you, Mr. Chairman, for holding the 
hearing.
    Ambassador Bremer, doing a great job; good to see you for 
the third time this week. You have been very busy testifying in 
a number of places and in a number of different hearings. And I 
appreciate your attendance and your candid comments that you 
are putting forward constantly in these hearings.
    I want to direct my comments and questions to you into an 
area that has been hit already but I want to get maybe a little 
finer point it, if we could, the issues of religious freedom in 
the constitution and blasphemy laws, because these are such key 
issues. And what you are doing is so important to this country, 
to Iraq, and to an entire region, because you are really--as I 
have seen the thought process go forward here--and this has 
been one that has been stewing for some period of time.
    In 1998, the Congress passed the Iraq Liberation Act, 1998. 
The House vote on that was 360 to 38. The Senate passed it by 
unanimous consent. It called for regime change in Iraq. 
President Clinton signed that into law.
    And what we have been moving forward with and pressing is 
that here is a terrorist state, as you have noted, been a 
terrorist state for 20-some years, house terrorists on its 
soil, had used weapons of mass destruction in two campaigns; 
one against its own people, one against the Iranians. So, it 
had that mixture that we did not want to see. But in moving 
forward, in removing Saddam Hussein, it was not just to get him 
out of power, it was also to put in and insist on an open 
society, a democratic, open society that we thought would be a 
model for the region and would press that open society, 
democratic society, open society of free markets that would 
lift the entire region up and be for hope and prosperity for 
them and on principles that we believe in.
    One of the foundational principles is religious freedom for 
us. And I want to focus us on that, because we have insisted 
that there not be a separate Kurdish State to irritate the 
Turks. We have insisted that the Sunni minority participate in 
a Shiite majority country. I think we also need to insist that 
there is not a state religion, that there is religious freedom, 
that it is not declared that there is a certain religion that 
is the religion of Iraq, as a foundational principle in the 
constitutional discussions.
    I think that is important for us. I think it is important 
for the people in the region. And I want to cite to you a 
Washington Post article that, Mr. Chairman, I am going to ask 
it and a Wall Street Journal article be included in the record.
    The Chairman. It will be included.
    Senator Brownback. Thank you, Mr. Chairman.
    I just want to read from this. It was in the Post. This one 
is dated June 25, an article written by a gentleman in 
Pakistan. And he says this, ``There is a tendency to view the 
Muslim population as a monolith with a uniform agenda and 
little dissent. This outlook on Islam has prompted a slew of 
articles with titles like `Why Do They Hate Us?' But in 
Pakistan, many Islamic radicals hold equal and sometimes more 
animosity toward dissenting Muslims, particularly Shiites, than 
toward Westerners.'' And then he goes on.
    I believe it is going to be imperative for us, as the 
constitution is developed, that we insist upon religious 
freedom in that constitution, no blasphemy laws, because those 
are used in a very pernicious way in a number of countries to--
even if you declare there is religious freedom, yet you will 
backdoor use the blasphemy law to enforce a religious regimen, 
and that we state in the constitution, it be in the 
constitution, that it is not in the constitution that Islam is 
the religion of the state.
    I would like your particular thoughts on this, because I 
think this is foundational to what we are dealing with, 
particularly as we want to press for a model democracy and open 
society in this region.
    Ambassador Bremer. Well, as I said earlier, in answer to 
Senator Allen's question and Senator Chafee's question, we have 
stressed the importance of individual liberties as a 
foundational view that we think has to be reflected in the 
constitution. And that includes religious freedom.
    I am optimistic that we will succeed in that. I am not 
certain what they will actually say about the role of Islam. 
Because, first of all, as I said to Senator Chafee, we have not 
even got this convention convened yet. I do not even know who 
is going to be there.
    Now, we will certain make clear our views on the importance 
of religious freedom and, on the broader point that Senator 
Allen made, really individual rights, women's rights and so 
forth, which are--I think religious freedom is one element of 
an even broader point that the Senator pointed out. And we will 
certainly make that clear.
    Senator Brownback. What about on blasphemy laws?
    Ambassador Bremer. Well, I made a note of that. That is a 
good point, sir. And I will add that to my list.
    Senator Brownback. It is used often----
    Ambassador Bremer. Yes, that is a good point.
    Senator Brownback [continuing]. And in a very ugly way.
    What about the statement that, and some apparently are 
saying this, that it will be in the constitution that Islam is 
the religion of the state?
    Ambassador Bremer. Well, again, I cannot make any further 
conjectures because I just do not know how it is going to come 
out. I understand your view and I will certainly make it known.
    Senator Brownback. Well, we have been very aggressive on 
the issue of a separate Kurdish State.
    Ambassador Bremer. Correct.
    Senator Brownback. And have said no separate Kurdish State, 
primarily I presume, because the Turks have said, look, we do 
not want this, and this is kind of our basic for us staying 
with you. And we agreed with that. I think we should be equally 
as firm on these issues; they are foundational and I do not 
hear that coming from you.
    Ambassador Bremer. Well, I have spoken on both of these 
subjects at great length, including the Kurds. The reason for 
not encouraging a Kurdish State is not because the Turks do not 
want it, it is because it is not in our interest.
    Senator Brownback. Is this in our interest, to not have--I 
mean, that we had explicitly have in there that there be 
religious freedoms?
    Ambassador Bremer. It is in our interest, yes; absolutely.
    Senator Brownback. OK. So, that is foundational for us in 
pushing the constitution?
    Ambassador Bremer. Yes. Well, I would put it in the broader 
context of individual liberties. There is no question.
    Senator Brownback. That the issue of religious freedoms 
will be guaranteed in that constitution.
    Ambassador Bremer. I will make the point, Senator. But the 
Iraqis are writing this constitution, not me.
    Senator Brownback. I understand. They are also----
    Ambassador Bremer. All I can do is make the point. And I 
certainly will. I got the message.
    Senator Brownback. If you could. And I think you are doing 
a great job. I want to make sure that on such a key issue, we 
are clear on it.
    Thank you, Mr. Chairman.
    [The news articles Senator Brownback referred to follow:]

      [From The Washington Post, Editorial Section, June 25, 2003]

                    Radical Muslims Killing Muslims

                         (By Zahir Janmohamed)

    When Pakistan was created, its founder, Mohammed Au Jinnah, 
famously declared, ``You are free, free to go to your temples, you are 
free to go to your mosques or to any other places of worship in this 
state of Pakistan. You may belong to any religion or caste or creed--
that has nothing to do with the business of the state.'' Fifty-six 
years later, I wonder what Jinnah would tell my family and countless 
others who lost loved ones because of rising religious intolerance in 
Pakistan. On April 2, 2000, my uncle, Sibtain Dossa, a doctor, was 
gunned down at his medical clinic by Islamic radicals seeking to 
cleanse Pakistan of its minority Shiite Muslims.
    Over the past few years, extremist Islamic groups in Pakistan have 
mounted a unilateral terror campaign. But Americans and Christians have 
not been the only victims. Women, secular advocates and even Muslims--
Ahmadis, dissenting Sunni Muslims and Shiite Muslims--have also come 
under attack.
    Recently two gunmen on motorcycles opened fire on a truck full of 
policemen, killing 11 and wounding nine in the Pakistani town of 
Quetta, near the Afghan border. Nearly all the victims belonged to the 
minority sect of Shia Islam. The attack on Shiites was the third in 
Quetta in less than two weeks. Speaking of the attack, Rahmat Ullah, a 
Pakistani senior police official, accurately noted, ``It was sectarian 
terrorism.''
    The gruesome cycle of violence against Pakistan's minority citizens 
could not have occurred without the complicity of the Pakistani 
government. Consider the example of Azam Tariq, a religious cleric and 
former leader of the radical, Saudi Arabia-inspired Sipah-i-Sahaba. In 
an interview with the BBC in 1995, Tariq openly praised the Taliban and 
endorsed attacks on Shiites in Pakistan. Instead being brought to 
justice, Tariq was rewarded. Today he is a member of Pakistan's 
National Assembly.
    There is a tendency to view the Muslim population as a monolith, 
with a uniform agenda and little dissent. This outlook on Islam has 
prompted a slew of articles with titles like ``Why Do They Hate Us.''
    But in Pakistan, many Islamic radicals hold equal (and sometimes 
more) animosity toward dissenting Muslims (particularly Shiites) than 
toward westerners. The Sipah-i-Sahaba have even killed many of their 
own Sunni clerics, because the clerics rejected their divisive agenda. 
Often, implementing a skewed understanding of Islamic sharia (religious 
law)--and not hatred of the West--is their prime motivation.
    If the United States wishes to gain credibility in Pakistan, it 
should pressure Pakistan to protect all of its residents who stand 
threatened by the rise of Islamic radicalism in Pakistan--not just 
westerners and Christians.
    As Muslims lobby the United States to treat its religious 
minorities with respect, Muslims themselves have averted their gaze 
while minority groups--particularly Ahmadi and Shiite Muslims--are 
butchered by their ``fellow'' Muslims. Indeed, much of the Muslim world 
looked away when Saddam Husssein was executing Shiites in Iraq and 
ignored the Taliban's mass beheading of Shiites in Afghanistan.
    This does not absolve Shiite Muslims of guilt. Many Shiite clerics 
have irresponsibly inflamed sectarian tension by denouncing beloved 
Sunni icons or, worse, endorsing retaliation. But a Muslim group that 
condemns violence when Islamic radicals kill Christians, then remains 
silent when Islamic radicals kill Shiite Muslims, is not a human rights 
group but a PR firm.
    Pakistan can curtail the rise of sectarian violence and prevent the 
spread of extremist Islam by doing three things: punish (instead of 
reward) those who commit unprovoked acts of aggression against 
innocents of other faiths; block Saudi Arabia from flooding Pakistani 
schools with textbooks that preach draconian interpretations of Islam; 
and restore civil society in urban centers so that extremist groups 
cannot exploit Pakistan's woes to promote their divisive agendas.
    My last memory of my uncle was sitting with him in the sprawling 
garden next to the tomb of Jinnah in Karachi. I asked if Pakistanis--
particularly Pakistani Shiites--still respected Jinnah.
    ``We do,'' he told me. ``Because at least Jinnah tried to create an 
open Islamic country where all could flourish.''
    That seems to summarize the history of Pakistan: It has always 
tried but never achieved Jinnah's goal.
    Zahir Janmohamed is writing a book about the rise of religious 
violence in South Asia.

                                 ______
                                 

                     [From The Wall Street Journal]

       Afghanistan's Islamic Reaction--The Taliban Are Gone, But 
                 Fundamentalists Try to Reassert Power

                  (By Philip Shishkin, Staff Reporter)

    Kabul, Afghanistan.--Hounded by police and threats of imprisonment, 
Ali Reza Payam has fled his home and shuttered his office. He is hiding 
somewhere in this crowded city, unreachable even by some of his 
friends.
    Mr. Payam is on the run because of a newspaper article he wrote in 
June. ``The time for religious dictatorship is over,'' he wrote in 
Aftab, a Kabul weekly that translates as Sun. ``People are no longer 
ready to accept that religious leaders have a divine position and are 
permitted to rule as they want.''
    Despite all the Western influences that have come to Afghanistan 
since the fall of the Taliban, such ideas still risk censure and 
punishment. Islamist judges and politicians are trying to reassert 
their power less than two years after the nation emerged from a harsh 
religious dictatorship. While a return to the excesses of the past is 
highly unlikely, hard-line Islamists are intent on reining in a society 
they think has become too freewheeling, pitting Islamic reactionaries 
against the nascent forces of liberalization.
    The outcome of this power struggle--which will play out as Afghans 
try to devise a new constitution this year--will have consequences not 
just for Afghanistan but also for the West, which wants to prevent a 
revival of the extremist threat that once emanated from this Central 
Asian country. The struggle will also inform a debate that has long 
vexed the broader Islamic world: how to find a balance between 
individual freedom and religious conservatism.
    ``For so many years, we had a culture of the gun,'' says Abdul 
Hamid Mobariz, Afghanistan's deputy minister for information and 
culture. ``Now we are developing a culture of the pen. But we need some 
time.''
    In her office watched over by a guard with a Kalashnikov assault 
rifle, Sima Samar, now head of the country's Independent Human Rights 
Commission, says Islamic activists have become ``more powerful than 
they were last year.'' Ms. Samar has felt their influence first-hand. A 
year ago, when she was Afghanistan's vice president and its first 
minister of women's affairs, Afghanistan's conservative Supreme Court 
deemed her unfit for those posts after she said during a trip to Canada 
that she didn't believe in the Taliban version of Sharia law, the 
Islamic legal code. Local Islamists compared Ms. Samar to Salman 
Rushdie, whose novel ``The Satanic Verses'' prompted Iranian clerics in 
1989 to sentence him to death in absentia for blasphemy.
    ``I was disappointed that nobody said anything,'' says Ms. Samar, 
whose current position carries no real power. ``This isn't democracy.''
    Afghanistan's high court is a bastion of religious conservatism. In 
a dilapidated concrete headquarters in central Kabul where Afghans come 
to resolve mundane legal matters ranging from property disputes to land 
claims, the justices also attempt to regulate cultural life. Presiding 
over the court is Chief Justice Hadi Shinwari, an octogenarian Sharia 
scholar who was educated in Pakistani religious schools. Mr. Shinwari, 
who declined to be interviewed for this article, is a close political 
ally of Abdul Rasul Sayaaf, a former warlord and a Saudi-backed leader 
of an Islamic party.
    Deputy Chief Justice Ahmad Manawi says the greatest threat to 
Afghan society comes from exiles returning after years abroad, some of 
them assuming government positions. ``These are the people who provoke 
Afghans to change their beliefs, to be like Westerners,'' says Judge 
Manawi, who fought the Taliban with the opposition Northern Alliance 
and is now considered as influential as his boss, Mr. Shinwari.
    Under the 1964 constitution, which was provisionally restored after 
the fall of the Taliban, secular law trumps Sharia. Currently there is 
no death sentence in Afghanistan, but Mr. Shinwari and other judges 
support restoration of the Islamic legal code, known for such harsh 
punishments as amputations, stonings and public executions. A 
constitutional assembly is expected to clarify the extent to which 
Islamic principles and laws should influence legislation and individual 
freedom in Afghanistan.
    The contrast between religious conservatism, a deeply rooted 
feature of Afghan society, and the recent proliferation of liberal 
influences are palpable in Kabul. In a city where many women still wear 
the burka, a tentlike garment required for all woman by the Taliban's 
virtue squads, the ministry of women's affairs, with help from foreign 
donors, just opened a beauty school where Afghan women are taught how 
to apply makeup and style hair.
    The Islamic reaction is exemplified by a temporary ban on cable 
television in Kabul, which the high court saw as a conduit for morally 
reprehensible programming, mostly in the form of Western movies. At the 
Star Cable Network's small office, manager Mustafa Saiedy says police 
officers showed up in January, instructing him to pull the plug on the 
company's 1,500 customers. For three months, Kabul had no cable.
    Spurred by the court action, the Ministry of Culture came up with a 
list of 65 channels that would be permissible to watch, including the 
British Broadcasting Corp., Cable News Network, National Geographic, 
the Discovery Channel, and certain sports and movie channels. Omitted 
from the list were previous Star offerings Home Box Office and other 
Western movie channels. Mr. Saiedy accepts the censorship, saying 
before the ban customers complained about lurid fare. ``We're trying to 
broadcast things to educate people,'' he says.
    Adds Mr. Mobariz, the deputy culture minister: ``We live in a 
Muslim country. We don't want sex films shown to children. We don't 
accept channels against Islam.''
    At times, the Supreme Court's attempts at ethical enforcement seem 
like trying to block an avalanche with a fence. While the court went 
after Kabul's cable operators, which have fewer than 10,000 
subscribers, it has done nothing to restrict satellite television in an 
Afghan capital full of satellite dishes.
    But Mr. Manawi, the deputy chief justice, is intent on finding Mr. 
Payam. The judges say his article is blasphemous because it questions 
the validity of Islam. Mr. Payam and a colleague were briefly arrested 
after the story appeared in June. President Hamid Karzai--who is trying 
to walk a fine line between Islamic fundamentalism and the forces of 
democracy--said at the time that the article offended the beliefs of 
the Afghan people.
    A few days later, while authorities tried to determine their legal 
status, the journalists were released from jail--and promptly vanished, 
much to the disappointment of Mr. Manawi. The United Nations, which is 
helping protect Mr. Payam, declined to make him available for an 
interview.
    Mr. Manawi wants to question the journalists to see whether they 
still believe what they wrote and whether anyone put them up to it. Mr. 
Manawi wouldn't say what kind of punishment he thinks they deserve.

    The Chairman. Thank you very much, Senator Brownback.
    Senator Corzine.
    Senator Corzine. Thank you, Mr. Chairman. And to you and 
Senator Biden, I am grateful you are having this hearing. And I 
am also grateful for the service that Ambassador Bremer and the 
folks who are carrying out our policies on the ground are 
doing. And like others, I convey my well wishes and support for 
them.
    I was interested in reading the testimony. You said we have 
a definite plan with milestones and dates. Have those 
milestones and dates been shared with those of us that are 
being asked to lay down the appropriations?
    Ambassador Bremer. Yes. Although I have to say this 
particular plan is, as you can understand, under constant 
revision, because we are in a rather fluid situation over there 
but they have been, yes.
    Senator Corzine. When was this done?
    Ambassador Bremer. On July 23.
    Senator Corzine. And was that given to the committee? Have 
we had discussions of that here among us?
    Ambassador Bremer. I do not know if the committee has had 
discussions. It went to every Member of Congress, both Houses.
    Senator Corzine. I am unaware of that. I guess I am not--my 
staff and I must not be transparent.
    Ambassador Bremer. I would also have to say that since it 
is now 2 months old, it is out of date. It has been updated; it 
is updated, basically, every month, because the situation 
changes. But the strategy is the same.
    Senator Corzine. We have----
    Senator Sarbanes. It did not have datelines in it, though, 
in fairness to Senator Corzine.
    Ambassador Bremer. Excuse me?
    Senator Sarbanes. Did it?
    Ambassador Bremer. Yes, it did.
    Senator Corzine. As opposed to dates.
    Ambassador Bremer. It had--it had 60-, 90-, 120-, and 360-
day benchmarks across a whole series of issues in the four 
major areas of our plan.
    Senator Biden. Which were not met.
    Ambassador Bremer. Excuse me?
    Senator Biden. Which were not met; right?
    Ambassador Bremer. Well, a lot of them have been met--I 
mean, some of them have not been met. That is true of any plan. 
But we do have--I mean, the plan is there.
    Senator Corzine. Was there any discussion with Congress 
when this plan was put together and the dates and milestones? 
Was a basis of consensus sought on a bipartisan basis? By the 
way, we use the Marshall Plan as an example. It took a year, 
multiple reviews through appropriations committees, authorizing 
committees, that went on for a very extended period of time. As 
I say, I guess I am just an uninformed Senator. I was not aware 
this was made available to us to study.
    Most of my colleagues have been asking for dates and 
milestones in conjunction with this. So I am curious whether we 
feel like this was a transparent process and one that was fully 
vetted here at home, let alone with our international allies.
    Ambassador Bremer. Well, Senator, I know there has been 
some confusion here. And all I can tell you is it was presented 
to the Congress July 23 when I was here. I outlined it publicly 
that same day in a speech that was covered by the national 
press, television and radio and the newspapers, before the 
National Press Club. There was nothing secret----
    Senator Corzine. Dates and milestones?
    Ambassador Bremer. There was nothing secret about the plan.
    Senator Corzine. Turning to the question of the oil 
reserves, is not one of the reasons that we want 
internationalization of this process, the outreach, is so that 
we can deal with this debt issue, so that we, therefore, might 
turn to the kind of financing arrangements that I think Senator 
Allen was referring to? There are whole extensive concepts, the 
securitization available with regard to oil reserves that have 
been used in other venues at other times and other places. Is 
that one of the major elements of discussion that is going on 
with allies?
    Ambassador Bremer. The discussion--you mean on debt? Not 
yet, that I am aware of. Now the debt discussion, as I 
mentioned, was essentially given a deadline at the Evian summit 
of trying to figure out what to do about Iraq's debt by the end 
of 2004. And all of the debt servicing was tolled until that 
date.
    Those discussions are conducted by the Department of the 
Treasury and by Secretary Snow. I know he was planning to have 
discussions with some of his colleagues in Dubai over the 
weekend at the IMF/World Bank meetings. I have not had a chance 
to talk to the Secretary in the intervening 48 hours. So, I do 
not know what happened there. If you want to get the latest, it 
is probably best to talk to the Treasury Department on that.
    Senator Corzine. Could you relate to us where you think the 
greatest concentrations of this debt are held?
    Ambassador Bremer. Well, again, there are two categories. 
There is the governmental debt, where the main creditors are, 
if I remember correctly, France, Germany, Japan, and Russia. 
And there are the reparations, which is, strictly speaking, not 
debt but reparations, where the main demanders are the regional 
countries who are victims of Saddam's aggression, Kuwait, Saudi 
Arabia, and so forth, Gulf States.
    Senator Corzine. So, the people that you were mentioning 
are the ones that we have the most negotiations to do, to deal 
with, in resolving the debt problems, so that we can get to 
other potential solutions and use of reserves.
    Ambassador Bremer. Yes.
    Senator Corzine. I would hope that we would understand that 
the burden of $87 billion and all subsequent requests that are 
talked about, again not dealt with in specific, go to the 
American people. There are other alternatives that I think it 
is very hard, particularly in light of some of the arguments 
that we have heard from people in the administration before, 
about the availability of these resources. It is very hard for 
the American people to understand why their schools are not 
being dealt with versus the others.
    Thank you, Mr. Chairman.
    The Chairman. Thank you very much, Senator Corzine.
    We have two Senators remaining. I think we are going to be 
able to accommodate both before noon, with your cooperation, 
sir.
    Senator Sununu.
    Senator Sununu. Thank you, Mr. Chairman.
    I appreciate the time. And I apologize if I am talking a 
little bit fast. Maybe we can get a little bit more in if we do 
that.
    My staff is very good. I do not know if they are better 
than anybody else's staff but I certainly have a copy of the 
July 21 plan and want to talk about that a little bit, in terms 
of the milestones and some of the dates that are here, try to 
get our hands around what has been done and what still needs to 
be done, where we have been successful and maybe not so 
successful.
    You mentioned the foreign investment law for foreign 
ownership. One of the first milestones in the financial market 
structure section is a central bank law. Are those one and the 
same or is the central bank law distinct? And the timetable for 
getting the central bank law done was September. Has that been 
done?
    Ambassador Bremer. Yes. I signed it into law a week ago.
    Senator Sununu. What assurances does the international 
community have, or do we hope to have, that the new government 
will consistently and fairly enforce these new laws for foreign 
ownership, for capital investment, and for capital flow?
    Ambassador Bremer. Well, that is a very good question, 
Senator. You will see, I think somewhere else in there, the 
need to get a body of commercial law in place. We need to have 
a decent bankruptcy law, which does not exist. We need to have 
a competition law, which also does not exist. Those are the 
three elements that we are working on now.
    I am hoping that we will be able to get those three 
building blocks for commerce in place in the next couple of 
months.
    Senator Sununu. The timetable for power capacity, one of 
the things that I saw in my visit there, the damage to the 
electricity infrastructure and the slow pace of reconstruction. 
It is my understanding that the goal is to have 4,400 megawatts 
on line by September 30. Yesterday's power production was, I 
want to say, 3,780 megawatts.
    Now, I notice--I will give you a little credit here. In 
your plan it says generating capacity of 4,000 megawatts by 
October 3. And you appear to actually have raised your goal to 
September 30. Are you going to meet that goal of 4,400 
megawatts?
    Ambassador Bremer. Well, I hope we will. Actually, the 
number you gave of 3,780 was the day before yesterday. 
Yesterday we had a little failure in one of the power plants. 
And we were at 3,650 yesterday. But we will get to 4,400. I 
think we will get there by September 30, but that is next 
Tuesday. So we are going to have to really press, which we are 
doing.
    Senator Sununu. The end of the year goal, according to 
this, is 5,000 megawatts?
    Ambassador Bremer. Yes. I think we will----
    Senator Sununu. Is that also within reach?
    Ambassador Bremer. Yes, it is. The important, the really 
important role there, Senator--goal is to get back to demand. 
And demand is about 6,000 megawatts, we think. And we hope to 
get there by next summer.
    Senator Sununu. And the kinds of problems that you have 
been having, I mean, I have read about condenser leaks. I think 
the accident you described is an air gas problem. They had an 
explosion in one of the generators?
    Ambassador Bremer. Right.
    Senator Sununu. Are they just those kinds of functional 
problems or are there any logistical hurdles in the contractor 
administering this kind of a construction?
    Ambassador Bremer. No. The problem we have in power is 
essentially the problem of spectacular under-investment in the 
power industry for 35 years. They are working with equipment 
that in many cases is 20 or even 30 years beyond its useful 
life. And so we have boilers exploding. We have breakdowns in 
pipes. We have, every day, a long list of problems; and we have 
to fix them.
    Senator Sununu. One of the other areas, milestones, on 
essential services is to distribute, give out, the mobile 
cellular licenses, again by the end of September. Has that been 
achieved?
    Ambassador Bremer. No, but it is not the end of September 
yet. It will be achieved within the next 10 days.
    Senator Sununu. You are on track to completing that work, 
as well?
    Ambassador Bremer. Yes, we are. On the mobile, yes.
    Senator Sununu. Terrific. Devolving power. This has been 
brought up by a number of Senators here. What responsibilities 
and day-to-day decisionmaking authority has already been given 
to ministry-level positions, and which ministries, obviously? 
And over the next 90 days, let us work within this 90-day, end-
of-year timeframe, what key decisionmaking or ministries will 
take over day-to-day responsibilities themselves?
    Ambassador Bremer. Well, the ministries have really got 
full responsibility and have had it since they were appointed 
on two major things. They set ministry policy and they set the 
ministry budget. And over the next 90 days, assuming we get the 
supplemental, the major responsibility they are going to have 
is working with us to implement the major projects in the 
supplemental that fall to their respective ministries.
    Senator Sununu. But it would seem to me that some 
ministries are going to be further in front of the curve----
    Ambassador Bremer. Yes.
    Senator Sununu [continuing]. Than others. And I guess where 
is the most movement, most progress, going to be made in the 
next 90 days, what areas of the government?
    Ambassador Bremer. Well, it is hard to say. We will just 
let them go as fast as they can. I mean, some of the ministries 
are going to be better organized. Some of them have bigger 
problems. Some of them are going to have a lot more money. The 
one that really matters most is the Ministry of Finance. And we 
are working very closely with the Minister; he will be the key. 
And we expect him to continue to assume more and more 
authority.
    Senator Sununu. And what will be the last areas of power 
that are relinquished by the CPA?
    Ambassador Bremer. Well, I think the last one to be 
relinquished fully will be the Ministry of Finance and the 
Ministry of Interior, the things affecting the overall budget 
and the overall security situation. But we will see how that 
develops over the months ahead.
    Senator Sununu. Are the proposals for the oil trust fund 
finalized? Also one of the early milestones for the economy.
    Ambassador Bremer. We have proposals. We have not yet had a 
chance to have a full discussion with the Governing Council and 
the relevant ministries. I have had a preliminary discussion 
with the new Minister of Oil. I called on him 10 days ago. He 
is enthusiastic about establishing a trust. And we will work 
with him in the next few months on that.
    Senator Sununu. You are at 1.9 million barrels a day.
    Ambassador Bremer. It was 1.7 yesterday, 1.9 the day before 
yesterday.
    Senator Sununu. And what is the end-of-the-year goal?
    Ambassador Bremer. Well, I think we are going to get above 
two million. And we are hoping to get back to the maximum, 
three million, the plan says by next October. Maybe we can beat 
that.
    Senator Sununu. Is the process for selling that oil, 
collecting the revenues from that oil, and utilizing the 
revenues from that oil, is that process completed? Is it going 
to change substantively over the next 6 months, or is what is 
in place today what we are going to move forward with over the 
next year or so?
    Ambassador Bremer. Well, no. They have a very efficient 
sales and marketing company, which is very good at this. They 
know how to sell oil and collect the revenues. The things that 
will hopefully happen is we will export a higher percent than 
we are now exporting.
    Senator Sununu. Any concerns about the transparency of that 
process?
    Ambassador Bremer. Well, there are obviously concerns about 
avoiding corruption in any of the ministries there. It was a 
corrupt regime. And we have to continue to work and are working 
with ministers on that. Yes, there are concerns. Sure.
    Senator Sununu. Have there been specific instances----
    Ambassador Bremer. No. There are no--no.
    Senator Sununu [continuing]. Of corruption that we need to 
be aware of or concerned of or----
    Ambassador Bremer. No. We are going to use standard 
American accounting and auditing procedures for all of the 
moneys that are being appropriated. And we are going to watch 
it very closely.
    Senator Sununu. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Thank you very much, Senator Sununu.
    Senator Voinovich.
    Senator Voinovich. Mr. Bremer, thank you for your efforts 
and service to our country. And I have been impressed with your 
leadership, steady demeanor, and willingness to engage Congress 
on the supplement request. While I believe it is important that 
we continue our efforts and follow through in our efforts to 
promote a free democratic and stable Iraq--and I think it is 
really important that we emphasize regularly to the American 
people that this is an opportunity that we have, and we cannot 
miss this chance to stabilize that area. It is important to us. 
It is important to our children. It is important to our 
grandchildren. And I think more of that has to be done so the 
American people understand how important our involvement is 
there to out future.
    I remain convinced, and so do a lot of others, that 
involvement in the international community is crucial to our 
long-term success. And we are very pleased that the President 
has gone to the United Nations.
    You have made it clear that the costs involved in 
rebuilding are going to be huge, upwards to $70 billion for 
infrastructure alone. I think you are well aware of the fact 
that we have massive deficits here in this country. We have 
growing infrastructure needs and a lot of things. And we have 
to explain back to our folks in our respective States just what 
we are doing here.
    And many of us have talked to Mr. Wolfowitz and others 
about the possibility of a loan, in terms of the $21 billion. 
The response that we received back is that--that would put you 
in a very difficult position, that Iraq owes the people that 
you already mentioned, and the Arab countries, that we are 
going to be trying to get them to discount those loans, work 
with the Paris Club to bring them down, as we have in other 
instances.
    Some make the argument that if we are going to rebuild the 
oil infrastructure, that ultimately we ought to get paid back 
for that. I mean, there is a certain amount of logic that says 
if we put money into rebuilding their infrastructure so they 
can produce the number of barrels that they should be 
producing, that there should be a return. The answer I get back 
on that one is, well, that just plays in the hands of the 
people who say we are there because of oil interests.
    All I can say to you is that you may get through this 
period now with us, but I think there is going to have to be 
some language connected with any further request coming before 
this body in terms of infrastructure of some participation by 
our friends, the French and the Japanese, the Russians and 
others, the Arab countries. We have rid them of their nemesis; 
they should be very grateful to us.
    These loans that they have to Iraq ought to be waived and 
some logic brought to this and some common sense of 
participation. And we want some assurances that is going to be 
the case, that this is not just going to be Uncle Sugar's, you 
know, full responsibility.
    And I am a little bit skeptical about some of the--you 
know, you are going to have your donor's conference. Well, I 
have followed southeast Europe. And I might say to you, you 
know, we bombed Serbia and destroyed. And, you know, we were 
supposed to help there. And we said, well, that is not our job, 
it is the stability pact. But if you go back--and I am going to 
get the numbers for you--the stability pact has not come up 
with the money that they said they were going to put into 
southeast Europe.
    So the point I am making is, what are you going to do to 
try and allay some of our concerns and bring some common sense 
to this, so that we can explain to the American people that 
this just is not going to be our load alone, and that the rest 
of the world, who is going to benefit from a stabilized Iraq 
and that part of the world and moving forward with maybe 
dealing with Israel and Palestine, should be paying part of 
this?
    Ambassador Bremer. Look, Senator, I completely understand. 
As I said in my statement, the idea of having some kind of a 
loan or some kind of a payback is obviously an appealing point. 
The problem is we do have a major debt overhang that has to be 
dealt with.
    I think in terms of other countries there is the donor's 
conference. And there are on the order of $2.5 billion of 
frozen assets that belong to Iraq that are in other countries, 
that we are trying to get those countries to send back to Iraq. 
They belong to the Iraqis.
    You may recall here in the United States we had $1.7 
billion in frozen assets here in the country, which has now 
been returned to Iraq, and which is part of our ongoing budget. 
And we are going to try to work with the international 
financial institutions, particularly the World Bank and the 
IMF, to come forward as well, as they have traditionally often 
been able to do in countries in distress, like Iraq.
    The paradox, and it is a difficult paradox, is Iraq is a 
rich country but it is temporarily poor. And we have got to 
help them get across the next 12 to 18 months to a point where 
their oil revenues will then begin to be able to cover, and 
more than cover, as I mentioned to Senator Sarbanes, the costs 
of running their government.
    By the year 2005, we believe that the Iraqi revenues should 
exceed their expenses on the order of $4 billion to $5 billion 
a year. And that money then can be used to cover some of the 
gap that we are not going to be able to and not intending to 
cover, the $70 billion that the World Bank says they need. The 
Iraqi people will need to start putting money into that rate 
construction themselves as soon as they can.
    Senator Voinovich. Well, I would certainly like for you and 
other folks that are involved in this to think about some kind 
of language that we can insert as part of this appropriation 
that lays out some of the things that you are going to be doing 
between now and then, and calls upon some of our friends to 
waive their loans, and to participate, and so forth. So that 
the next time you come back to us, that we are going to see 
some other people doing their fair share in terms of Iraq.
    Ambassador Bremer. I understand.
    The Chairman. Thank you very much, Senator Voinovich.
    Thank you, Ambassador, for your testimony.
    Senator Sarbanes. Mr. Chairman, can we prevail on 
Ambassador Bremer to stay for a little while longer? Some of us 
have, you know, two or three more questions we want to put to 
him. I do not know when another opportunity is going to present 
itself.
    The Chairman. Mr. Ambassador, you hear the dilemma. If 
you----
    Senator Biden. How about another 10 minutes, please?
    The Chairman. Can we carve out 10 minutes? And would that 
be satisfactory to the Senators?
    Ambassador Bremer. I am expected by another body at noon. I 
can give you 10 minutes, I guess, but----
    Senator Sarbanes. All right.
    The Chairman. Please, if you will.
    Ambassador Bremer. I understand your desire to ask the 
questions. And I want to be respectful of that.
    Senator Biden. My questions basically can be yes, no. You 
indicated that one of the reasons why you would not want to 
have the international community in charge of the operation in 
Iraq right now is you would not be giving our $20 billion to 
someone else in terms of how to spend it. Why is not the rest 
of the world asking the same question? Why would we expect the 
rest of the world to give ``you,'' meaning us, you know, $10 
billion, $20 billion, $30 billion in the process?
    Ambassador Bremer. We are not. The donors conference will 
give birth to a fund that will be managed not by me but by the 
World Bank. And that has been clear to everybody.
    Senator Biden. OK. Second question is: What is your primary 
concern, beyond the $20 billion, about whether or not you would 
report to the U.N. directly and be double-hatted? In other 
words, we have done this many times before, you would be the 
American running the operation, a U.N. operation, in Iraq. What 
is your major concern about that arrangement?
    Ambassador Bremer. I do not have a considered view on that, 
Senator. I just do not know enough about how that has worked in 
the past. And I think this is, as I said earlier to Senator 
Hagel, this is a discussion that is undoubtedly going to be 
taking place in New York over the next week or so, as they look 
at the resolution.
    Senator Biden. And the last point I will make is not a 
question. Assume we meet the targets of having a $5 billion 
surplus beyond the needs of the Iraqis in terms of oil exports 
revenues. That is still going to leave Iraq somewhere between 
$25 billion and $50 billion short.
    Ambassador Bremer. Yes but, Senator, one thing to bear in 
mind, the World Bank assessment of the $60 billion is that they 
think is a 4- to 5-year building program. So it is not as if 
they have to do $60 billion in the next 12 months.
    Senator Biden. No, no. I understand. But my point is, if it 
is over 4 or 5 years, 5 years, if it is $50 billion, that is 10 
bucks a year----
    Ambassador Bremer. Right.
    Senator Biden [continuing]. They are going to come up $5 
billion short a year. I mean, that is a----
    Ambassador Bremer. Well, one of the realities the Iraqis 
have got to face is they are going to have to put a lot of 
money into their oil fields to develop a better revenue stream.
    Senator Biden. Are other countries able to bid for 
contracts to reconstruct the oil fields? Can a French company 
come in and make a bid, an open bid?
    Ambassador Bremer. Yes.
    Senator Biden. Can a German company do that?
    Ambassador Bremer. Sure. That is a matter for the Iraqi Oil 
Minister to decide.
    The Chairman. Senator Sarbanes.
    Senator Sarbanes. Thank you, Mr. Chairman.
    And Mr. Ambassador, we appreciate your staying on with us 
here briefly.
    I want to address the economic laws you just signed, to 
which you made reference. Now, these laws allow foreigners to 
own up to 100 percent of Iraqi industry with the exception of 
those industries dealing with natural resources, like oil. 
Correct?
    Ambassador Bremer. That is right.
    Senator Sarbanes. Now, I want to read you a couple of 
comments in addressing this. One, Jeffrey Sachs, the economist, 
said that with regard to these new Iraqi investment laws, and I 
am now quoting him, ``I've seen privatizations close up in all 
the continents of the developing world. And privatization can 
be important. But it can be terribly abused and misused, as it 
was in Russia. There would be very little safeguard against the 
incredible wheeling and dealing that would occur, including 
wheeling and dealing, by the way, by U.S. interests. And there 
are no safeguards at the moment that would prevent that.''
    The Financial Times just a couple of days ago carried a 
story in which they said, ``A member of the Iraqi businessmen's 
union in Baghdad told the BBC Arabic Service the proposed 
reforms would destroy the role of the Iraqi industrialist, as 
Iraqi business groups could not compete in privatization 
tenders.''
    And I am concerned about the political ramifications of 
this economic policy. You know, we might as well be candid. 
There is a strong perception in the Middle East that the United 
States went into Iraq to exploit it economically, at least on 
the part of some elements. This is a perception left over, of 
course, from the colonial period. And, you know, there are some 
who perceive us as part of a new imperialism.
    How do you reconcile this need for foreign investment, 
which, of course, would move the economy, with this strong and 
negative political perception?
    Ambassador Bremer. Let me make two comments. First of all, 
the foreign direct investment law does not address 
privatization. Privatization is not on the table at this point. 
So both Mr. Sachs and the Financial Times, or whoever they are 
quoting, have not read it. We are not talking about 
privatizing, for example, the power company, the electrical 
company, the cement companies. We are not talking about 
selling, at this time, any of the State-owned enterprises, of 
which there are 192.
    That question will be quite appropriately, as Jeffrey Sachs 
points out, a matter that needs to be done very carefully over 
time, in coordination with the Iraqi Governing Council. I have 
specialists who are looking at that now. We have begun 
discussions with Iraqi ministries. I would expect that we will 
get to privatization probably not before the second quarter of 
next year. And we are very sensitive to the need to avoid the 
kind of thing that he refers to, particularly in Russia.
    Senator Sarbanes. Well, does the law that you signed allow 
foreigners to own 100 percent of Iraqi industry?
    Ambassador Bremer. Yes, it does. But the State-owned 
enterprises are not for sale. And they will not be for sale 
until we put into place a privatization agency to guard against 
exactly what Dr. Sachs is talking about. And I do not 
anticipate having that in place and having the political 
agreement from the Governing Council in place much before the 
second quarter next year.
    So, he is absolutely right in his assessment but it is not, 
at present, a question of privatization.
    Senator Sarbanes. Well, the New York Times on June 23 
carried a story, ``Overseer in Iraq Vows to Sell Off 
Government-owned Companies.''
    Ambassador Bremer. Right.
    Senator Sarbanes. The articles notes that you ``vowed 
today,'' June 22, ``to dismantle that country's State-run 
economy by selling off government-owned companies and writing 
new laws to encourage foreign investment.''
    Ambassador Bremer. Correct.
    Senator Sarbanes. Now, where does the 100 percent ownership 
figure in all of that?
    Ambassador Bremer. Senator, the Iraqi economy is dominated 
by 192 State-owned companies. They are not today for sale. 
There are other companies in Iraq that are semi-private. There 
are some private companies. If somebody wants to come in and 
buy those and if the seller wants to sell it, they are now free 
to buy them. That is what that law says.
    There is no privatization program in place yet. We are 
still working on it for exactly the reasons that Dr. Sachs 
says. It is extremely sensitive. It is politically volatile, as 
you pointed out. And we do not want to repeat the mistakes that 
were made in Russia. So, it is going to take us time.
    Senator Sarbanes. All right. Thank you, Mr. Chairman.
    The Chairman. Thank you very much, Senator Sarbanes.
    Thank you again, Ambassador.
    The committee will recess until 2:30, when we will again 
reassemble to talk about Iraq. We thank all Senators and the 
Ambassador.
    Senator Biden. Thank you, Mr. Ambassador.
    Ambassador Bremer. Thank you.
    The Chairman. Thank you.
    [Whereupon, at 12:10 p.m., the committee adjourned, to 
reconvene at 2:30 p.m. the same day.]
                              ----------                              

       Responses to Additional Questions Submitted for the Record

    Responses of Hon. L. Paul Bremer, III, Administrator, Coalition 
Provisional Authority, to Additional Questions for the Record Submitted 
                      by Senator Richard G. Lugar

                     supplemental request for iraq
    Question 1. What steps are you taking that will ensure that the 
reconstruction efforts build an Iraqi capacity to carry on/maintain 
reforms after the U.S. and CPA are gone?

    Answer. The first step to ensure that reforms have permanence is to 
provide an inclusive process wherein the Iraqi people participate in 
developing plans and programs for the reconstruction of Iraq. This is 
being accomplished through the functioning of the Iraqi Ministries, 
which are working closely with the Coalition Provisional Authority. 
Through close cooperation with the Iraqi Ministries, we are fostering 
pride and ownership in the restoration projects, in addition to 
utilizing the knowledge and experience of the Iraqi people. Secondly, a 
secure and stable environment plays an essential role in the 
reconstruction effort. We are in the process of a recruitment and 
training program to enhance Iraqi security forces in five areas: 1) 
police officers, 2) border police, 3) civil defense forces, 4) 
facilities protection services and 5) the New Iraqi Army. For reforms 
to endure, Iraqis must feel safe and secure from terrorists, criminals 
and Ba'ath party loyalists. Also, the Iraqi people must feel that theft 
borders are secure, without external threats, allowing for a peaceful 
existence with neighboring countries. Finally, the Iraqi people must 
freely elect their leadership under a fair and democratic process set 
forth in a constitution that they will draft and ratify. Ownership and 
participation in the creation of a democratic state will be a key to 
lasting reforms. It is the combination of all of these initiatives, 
reconstruction, security and participative democracy that will anchor 
reforms into the future.

    Question 2. How will laws or authorities you implement now--such as 
the ones you mentioned about taxes and foreign ownership--remain in 
place after CPA leaves?

    Answers. The Coalition Provisional Authority (CPA) works closely 
with the Governing Council, the interim Iraqi Ministers and private 
Iraqi citizens to develop regulations and orders that reflect Iraqi 
views regarding economic reform and other matters. This collaborative 
process, therefore, will result in actions by a future internationally 
recognized representative Iraqi government to preserve many of the 
provisions of CPA orders or to enact such provisions through the Iraqi 
law-making process.
    In addition, the drafters of the new Iraqi constitution may 
incorporate into that instrument certain fundamental concepts from CPA 
regulations and orders, as appropriate.
    The future Iraqi government's assumption of responsibilities from 
the CPA, as contemplated by U.N. Security Council Resolution 1483, will 
naturally require a process of transition. We have placed great 
emphasis on ensuring that the CPA's regulations and orders implement 
political and economic decisions shaped by Iraq's interim leaders, and 
supported by the people of Iraq.

    Question 3. It would be foolish to believe that Iraq will have 
turned the corners in every sector in 12 months. What will protect the 
Iraqis in the long term and ensure Iraq remains ``free'' upon our 
departure?

    Answer. We are providing the Iraqi people with the tools to take 
over their own security, and we are establishing basic living standards 
so that violent extremists cannot capitalize on poverty and despair. In 
so doing, we will create an environment for private investment that 
will allow Iraq to move toward economic independence and support its 
own security and essential service needs in the future. All the while, 
we are working toward the orderly transition to Iraqi self-government. 
In the past five months, we have made steady progress on all fronts.

    Question 4. Is your plan based on a long-term strategy and does it 
address gaps between your desired endstate for Iraq and the realities 
of how far Iraq can go in such a short period?

    Answer. Our goal is a secure, peaceful, democratic Iraq that will 
stand against terrorism in the region and no longer threaten the United 
States or other countries. In the past five months we have made steady 
progress toward our objectives. Despite occasional acts of sabotage, 
essential services are being restored, security is improving, the 
infrastructure for a sound economy is being put in place, and political 
transformation is underway.
    The Coalition's strategy for achieving these goals consists of 
several parts. We will provide a secure environment by taking direct 
action against the terrorist groups and individuals who are attempting 
to undermine progress, and restoring urgent and essential services to 
the country. We will seek an expanded contribution by the international 
community. And we will seek to accelerate the orderly restoration of 
full sovereignty to the Iraqi people. These elements of our strategy 
are mutually reinforcing: a secure environment is a prerequisite to 
restoring services, expanding international cooperation and creating 
the conditions for democracy.

    Question 5. What will the impact be on the CPA program plans and 
budget for Iraq reconstruction if the $20 billion requested is tied to 
a loan guarantee, or any other form of aid besides grant assistance?

    Answer. There is no capacity today for Iraq to repay loans for its 
reconstruction. The economy and infrastructure of Iraq were decimated 
from wars and years of neglect under Saddam's regime. Billions of 
dollars of debt were accumulated to finance the palaces and programs of 
Saddam Hussein. Billions of new dollars are needed to restore vital 
services and to provide security for Iraq. Structuring our assistance 
as loans with little hope of repayment will increase the difficulty of 
creating a self-sustaining, democratic, and stable Iraq. Lending money 
for this restoration will also create distrust among the Iraqi people 
over the intention of America's occupation. Additional reasons why the 
funds requested are as a grant, not a loan, include:

   A loan limits the ability of the supplemental to prioritize 
        items according to the United States national interest rather 
        than Iraqi national interest. For example, while building up 
        the new Iraqi army and other security spending is clearly in 
        the United States national interest, the Governing Council may 
        not afford it the same priority.

   While Iraq has a high level of natural resources in absolute 
        terms, these are spread across 27 million people. So, perhaps 
        contrary to public perception, oil alone will not take Iraq to 
        GDP per capita levels comparable to some of the smaller Gulf 
        States (where about the same amount of oil exports are spread 
        across far fewer people).

   The $20 billion Supplemental request is already sending a 
        message to other countries to donate resources. Providing it as 
        a loan almost entirely dissipates this message.

   France, Germany and Russia hold much of the Hussein-era 
        debt. If the USG provides loans instead of grants, it will 
        completely undercut U.S. diplomatic efforts to have Iraqi debt 
        forgiven or rescheduled, leaving Iraq mired in ``red ink.'' 
        Creditor nations will ask: ``Why should we forgive our debt to 
        Iraq, if the USG is piling on its own?'' They will not forgive/
        renegotiate their debt if it results in the United States 
        getting repaid.

   With the ever-changing security environment in Iraq, 
        Ambassador Bremer needs maximum flexibility to assign funds 
        where they are most urgently needed. Conditions and 
        restrictions placed on loans could needlessly complicate 
        Ambassador Bremer's task which in turn could have the effect of 
        keeping U.S. troops in Iraq longer.

   In the long run, the U.S. stands to gain a great deal of 
        moral capital for deposing the tyrannical Saddam Hussein and 
        then paying to create a democratic and prosperous Iraqi state. 
        Such moral capital would be diminished, if not undercut 
        entirely, if the U.S. forced Iraq to pay the U.S. back for its 
        work. Providing loans instead of grants would lend credence to 
        the view that the USG is an occupier, not a liberator, and that 
        the USG is placing Iraq in further debt just to enrich U.S. 
        firms.

                                 ______
                                 

    Responses of Hon. L. Paul Bremer, III, Administrator, Coalition 
Provisional Authority, to Additional Questions for the Record Submitted 
                    by Senator Joseph R. Biden, Jr.

                     supplemental request for iraq
    Question 1. I am concerned that your plans include no provision for 
the participation of free trade unions in the reconstruction of 
economic and political institutions in Iraq. No market democracy in the 
world today functions without institutions to represent the interests 
of working men and women, in the economy, in political life, and in 
civil society. Please explain why you have made no provision for free 
trade unions as part of the economic reforms enumerated in your 
reconstruction plans.

    Question 2. Free trade unions played a historical role in the 
transformation of Poland from a Communist state, an example much 
praised by the Reagan administration at the time. Please explain what 
you would do to build on that example: to promote the development of 
free trade unions as part of the economic and political reconstruction 
of Iraq. How would you take advantage of the resources available 
through the ILO, the ICFTU, the AFL-CIO international programs, the 
Department of Labor's international programs, and other entities with 
experience in this area?

    Answer. Although Iraq ratified the ILO Convention pertaining to 
Child Labor as late as 2001, it has not been a voting member since 
1992. However, a Ministry of Labor and Social Affairs delegation will 
travel to Geneva in November to participate in the Governing Body 
Plenary of the ILO to reaffirm their commitment to again becoming a 
fully participating member of the organization. From 1951 to 2001, Iraq 
ratified 15 ILO conventions, including seven of the eight core 
conventions. The ILO typically provides assistance to states in 
implementing their ratifications; we expect that assistance will be 
provided to Iraq through the ILO's Infocus Program on Crises Response 
and Reconstruction. Logically, we anticipate that Iraq's renewed 
participation in the ILO, and the resulting assistance it will receive, 
will influence the maimer in which Iraq modernizes its labor laws. We 
also expect that independent trade unions will participate in the 
development of new, progressive labor legislation. Recently, a Deputy 
Minister of the Ministry of Labor and Social Affairs was assigned a 
portfolio that includes liaison with the free trade unions emerging in 
the country.

    Question 3. Security concerns have at times slowed down spending on 
infrastructure projects. What capacity do we have now to begin spending 
this money? To what extent must the security situation improve before 
infrastructure rehabilitation can proceed?

    Answer. While security has been a major concern since the end of 
major conflict, reconstruction and work on the infrastructure have 
proceeded. Contracts with companies such as Bechtel, Flor Corporation, 
Perini, and BHEL have been in place and repair/rehabilitation work is 
ongoing. It is true that some companies, such as BHEL from India, 
require Coalition troops at their job sites as a condition of work. 
BHEL is performing work at the Bayji Gas Power Plant and we have 
accommodated them with support from the military. In other instances, 
such as in transmission line repair, security remains a concern due to 
the remoteness of work locations. These concerns were overcome by 
requiring the contractor to provide security, usually local Iraqi 
security guards, along the transmission lines being repaired.
    The electricity sector is a good example of how security has been 
provided while reconstruction work proceeded. Shortly after major 
combat operations ended, there was a large amount of damage done to the 
transmission network due to looting and, in some cases, sabotage. 
Repair crews were dispatched by the Ministry of Electricity to effect 
repairs, but often they were threatened with violence by armed 
individuals. In June 2003, the Ministry of Electricity (then Commission 
of Electricity) reestablished the Electric Power System Security (EPSS) 
force in conjunction with the Coalition's Facility Protection Service 
(FPS) initiative. The mission of the EPSS is to provide fixed-site and 
transmission line security for the Ministry of Electricity. The force 
grew from 1,000 personnel in July to 2,240 by September, and although 
constrained by a lack of equipment and weapons, they immediately 
provided 24-hour protection to over 200 sites throughout Iraq. By mid-
September, the number of attacks subsided, and it is important to note 
that in no circumstance was a repair crew injured or killed while 
repairing transmission lines, nor was an electrical site attacked or 
damaged.
    If Iraqi reconstruction projects are to succeed in the long term, 
the threats to the infrastructure need to be neutralized. Resources 
will be allocated to provide the Iraqi security services and judicial 
system with the capability to locate, apprehend and successfully 
prosecute the criminals who attempt to disrupt the infrastructure.

    Question 4. The plan calls for two new prisons to be built at the 
cost of $400 million. Could you provide an explanation as to why these 
prisons cannot be built for less than $50,000 a bed? What will the 
prisons recurring costs be and how will they be paid? Could you explain 
further the rationale to build the prisons in such a manner as to 
``reduce staffing costs'' given low labor costs and a dire need for 
jobs?

    Answer. The $50,000-per-bed estimate was derived by prisons 
experts. In the United States, maximum-security prisons cost 
approximately $100,000 per bed. According to guidance from the CPA 
Ministry of Housing and Construction, building to Iraqi standards, 
using Iraqi labor costs approximately one-half to two-thirds as much as 
a comparable project built to U.S. standards using American labor. We 
made the most conservative possible estimate of cost.
    It was not possible to estimate the cost-per-bed based on past 
Iraqi practice. First, almost all records of any description were 
intentionally destroyed. Second, no Iraqi-built facility remotely 
approached even minimal international standards. Unconscionable 
overcrowding, rundown facilities, filth, and disease-infected buildings 
were the standard.
    Recurring costs in the United States are approximately $23,000 per 
bed per annum. About 65% of that expense ($14,950) is labor. Labor 
costs are roughly one-third as much in Iraq as in the U.S. The reduced 
labor costs yield an annual recurring cost of $13,033.33 per bed per 
year ($14,950/3=$4983.33, added to the residual $8050 for non-labor 
costs), or $104,266,640 per year. That expense may be reduced by the 
lesser cost of food and utilities than in the United States. After the 
facilities open, these funds will be paid from the annual Iraqi budget.
    The reduced staffing costs are a fortunate by-product of built-in 
security features that reduce danger from human error or neglect, such 
as a physical design that leaves no area of the perimeter concealed 
from guard-tower view. These features will reduce the chances for 
criminals to escape. The maximum-security prisons will still depend far 
more heavily on human labor than would a comparable facility in the 
United States. To the extent that staff can be economized at these 
facilities, more personnel will be freed to perform critical work in 
other facilities.

    Question 5. There is a provision to provide English training for 
20,000 Iraqis at a cost of $30 million, $20 million of which is 
dedicated to salaries. Could you provide more information on the salary 
structure of the program? Do you intend to hire Iraqis or English 
native-speakers as teachers?

    Answer. The intention is to hire teaching staff qualified in 
teaching English as a foreign language. Assuming an 8-hour day for 
instructors, the average cost per instructor is $40,000 over a six-
month period.

Class size:  20.

Number of participants:  20,000.

Number of classes:  1,000 (20,000/20).

Class length:  4 hours/day, 6 months.

Number of instructors needed:  500 (1,000/2).

Salary cost (6 months):  $20 million.

Estimated average salary costs:  $40,000 per instructor for a 6-month 
period.

    Question 6. The plan calls for the creation of 22 Employment 
Centers to offer ``aptitude and ability testing, job counseling, job 
search assistance and referrals to employment and training 
opportunities'' at a cost of $8 million. Could you provide more details 
as to what productive role these centers can provide in an economy 
which the United Nations has estimated to have a 60% unemployment rate? 
How will these centers create jobs? Will there be jobs to refer people 
to?

    Answer. On September 16, the first of the planned 22 employment 
centers in Iraq opened in Baghdad. Since then, the Baghdad Employment 
Center has received over 8,000 applications from jobless Iraqis. On 
some days, as many as 1,000 people have visited the center to complete 
applications for possible employment. To accommodate this growing 
number, we are making immediate efforts to provide this new labor 
exchange system with as many job orders as we can.
    From experience in other post-conflict economies, we anticipate 
that entrepreneurial efforts and small businesses emerging unseen 
within the Iraqi economy to take advantage of the infusion of donor 
investments. We hope to solicit job orders from these as well as larger 
enterprises through an effort that has four thrusts:

          (1) In the near future, we shall offer on-the-job training 
        contracts to enterprises in Baghdad that find it difficult to 
        hire workers having specific kinds of skills.

          (2) We are contacting international contractors to estimate 
        their job demand and encourage them to list job vacancies with 
        the Job Center.

          (3) We are also hiring a cadre of Iraqi job developers who 
        will canvas sectors of the city contacting businesses of all 
        sizes to gather estimates ofjob demand and solicit job orders.

          (4) We intend to capitalize on Iraq's talented work force by 
        advertising the availability of applicants with advanced 
        degrees in publications that reach commercial interests, 
        international contractors and investors. Those who have 
        submitted applications to the Baghdad Employment Center appear 
        very qualified. While less than 20 percent of those on the 
        employment center's register lack high school diplomas, 37 
        percent have completed high school and another 26 percent have 
        baccalaureate or advanced degrees. From our experience, such a 
        degree of collective academic achievement is not typically 
        found on a register of unemployed applicants.

    Developing job opportunities is a high priority for the CPA. We 
recognize that credibility for the new Ministry of Labor and Social 
affairs and appreciation for the Coalition's assistance will increase 
when Iraqis have evidence that the emerging employment centers provide 
job opportunities.

    Question 7. The ``Catch-Up Business Training'' provision calls for 
developing ``a cadre of businesspeople and entrepreneurs in business 
fundamentals and concepts'' at a course of $10,000 per pupil for a 4 
week course. Could you provide more details as to how these figures 
were arrived at? Given that $20 million--the cost of the program could 
put thousands of Iraqis to work on public works projects, could you 
explain how these programs will help create the maximum number of Iraqi 
jobs?

    Answer. Iraqi business managers have no training or experience 
managing businesses in free markets, nor do they have any exposure to 
international accounting standards, capital markets, or foreign trade. 
There is currently no faculty in Iraq qualified to teach these skills. 
The ``Catch-Up Business Training'' program will require bringing to 
Iraq, faculty from the U.S. and possibly elsewhere. The cost estimate 
assumes a 10 to 1 student/teacher ratio, a per teacher cost of $1500 
per day including travel expenses, accommodations, and incidentals. An 
additional cost of $250 per day, per student for travel, accommodations 
and incidentals is required. The remainder is dedicated to program 
overhead, i.e. curriculum development and program management. By 
training more highly skilled business managers, the ``Catch-Up Business 
Training'' will create jobs though higher quality business management, 
thereby achieving higher growth rates and increased demand for jobs.

    Question 8. The Witness Protection Program calls for 100 families 
to be relocated at a cost of $1 million per family. Given Iraq's 
economic conditions, these figures seem high. Could you provide more 
information as to how these figures were derived and how the CPA 
intends to relocate families? Broadly speaking, where and in what 
conditions will relocated families live?

    Answer. The figures were derived from costs encountered in pricing 
witness protection and relocation costs in Kosovo, including 
consultations with the International Criminal Tribunal for Yugoslavia, 
and from costs associated with United States practice. One reason for 
the high cost is the robust and constant security that is necessary to 
protect anyone who cooperates in making a new and free Iraq from 
terrorist elements. The terrorists have already conducted bombings at 
the U.N., two police academies, and the Baghdad Hotel, and have 
assassinated a Governing Council member, a Spanish diplomat, a Sheikh, 
and a translator working in courts to coordinate with the Coalition. A 
second reason for the high cost is that because Iraq is smaller than 
the United States, with networks of terrorists and organized criminals, 
relocation abroad will often be required. Relocated families will live 
in conditions comparable to those of similar families in the country 
where relocation occurs. Relocations will also be made within Iraq. 
Experience over the past decade in the former Soviet Union, Eastern 
Europe, and Colombia confirms that justice cannot triumph over violence 
without credible witness security. One lapse would be fatal not only to 
the witness but to the crime- and terrorism-fighting endeavor. 
Moreover, revenge killings based on family or tribal loyalties are an 
unfortunate but commonplace phenomenon. Finally, families in Iraq are 
large. It is common for a family to have more than six children; and 
extended families often live together, expanding the number of kin 
susceptible to vengeful retaliation.

    Question 9. The budget request includes $150 million to begin a new 
``state of the art'' children's hospital in Basra that will cost $500 
to $700 million. I'm told that there were some objections on your staff 
to this project and developmental experts I have consulted do not 
believe this is the most efficient way to improve pediatric care with 
the available resources. Given that under your plan 200 hospitals can 
be rehabilitated and 900 clinics reequipped for $393 million, can you 
please explain how this $150 million project will help Iraq provide 
health-care to the largest number of Iraqis in the most efficient 
manner possible? What will be the recurring costs of the project on a 
year-to-year basis?

    Answer. The Basra area was among the most neglected under the 
former regime. Shi'ites in this area were particularly persecuted. 
Healthcare needs and health infrastructure were neglected for years. 
The Basra Children's Hospital, with state of the art care, would send a 
strong signal to all of Iraq that the U.S. is committed to assisting 
the Iraqis provide quality healthcare services regardless of geographic 
origin, ethnicity, or religion.
    This facility is part of an overall effort to restore and enhance 
Iraq's healthcare infrastructure to meet current and future needs. This 
effort includes, where appropriate, new construction, rehabilitation of 
existing facilities, and an aggressive community based maternal-child 
health program.

    Question 10. Ahmad al-Barak, a member of the Governing Council, was 
quoted in the New York Times as saying that if they were in control of 
spending the money, with CPA supervision, that in some cases the 
savings could be factor of 10. ``Where they spend $1 billion, we would 
spend $100 million,'' he said. What is your reaction to Mr. al-Barak's 
assessment? At the present, what level of control of the spending, if 
any, is appropriate for the Governing Council?

    Answer. The Governing Council has oversight of current spending of 
Iraqi funds through the budgeting process. Just recently, after close 
consultation with the CPA and its own ministers, it approved the 2004 
budget of $13.5 billion dollars. It must be noted that the Coalition 
has completed thousands of projects in the past six months, many of 
which have been carried out by Iraqis. In fact as of September 30, 103 
of 140 contracts awarded by Bechtel have gone to Iraqi companies. We 
will continue to work with the Governing Council to ensure all possible 
cost-saving measures are taken into consideration.

    Question 11. In your testimony, you noted that ``security is the 
first and indispensable element of the President's plan.'' Yet although 
the request outlines almost $51 billion for securing transmission 
lines, only $50 million, less than 1%, is dedicated to securing the 
electrical infrastructure and no details are given. $60 million would 
be dedicated to providing security for the oil infrastructure. A 
critical component of the Iraqi resistance to the CPA is attacks on 
``soft'' targets. Attacks on oil pipelines can cost millions of dollars 
a day, while attacks on the energy infrastructure seriously undermine 
our efforts to win the hearts and minds campaign. Could you please 
provide some more detail on how these requests will adequately guard 
Iraq's fragile oil and energy infrastructure and contribute to a more 
stable Iraq? What is the capacity of the existing Electricity 
Commission Power Police?

    Answer. We anticipate that the energy infrastructure will need 
security during and after reconstruction. Both the oil and electricity 
ministries have implemented increased security through the use of their 
security forces, as well as contractor support. For example, we 
currently have 2240 electricity security force personnel fully 
outfitted and in place. We will be increasing that number to 4000 in 
the near future. We will augment these forces through the use of 
contractors and aerial surveillance of the entire transmission line. We 
have also contracted with tribes near the lines to provide additional 
security. We believe the energy infrastructure will be adequately 
covered with the security programs funded in the supplemental request.

                                 ______
                                 

    Response of Hon. L. Paul Bremer, III, Administrator, Coalition 
    Provisional Authority, to an Additional Question for the Record 
                   Submitted by Senator George Allen

                     supplemental request for iraq
    Question 1. Do you intend for the wireless work to be done by 
American firms?

    Answer. The tender approach used, as previously reported to 
Congress, ensured a fair and level competitive basis. The intent of the 
tender was to be as technology neutral as possible and to insure CPA 
received submissions, to include from U.S. firms, which were compliant 
with meeting the telecommunication requirements for Iraq. Since the 
submission of bids closed on 21 August, a team of experts drawn from 
Iraq, the U.S. and the UK has analysed and compared proposals. A 
majority of that team was made up of Iraqis; a panel consisting of two 
Iraqis and two CPA officials made the final recommendation. 35 
companies submitted a total of over 100 bids for the three licenses 
offered. The Iraqi Ministry of Communications assessed the bids against 
a list of criteria prepared before the bids were received. The criteria 
were designed to ensure an objective and fair assessment of the merits 
and failings of each bid. On 6 October the Iraqi Ministry of 
Communications announced its selection of three consortia to provide 
initial wireless service in Iraq. While an American firm did not win 
one of the bids, one of the winners already announced that an American 
company would be one of its primary equipment suppliers; other American 
companies may also sub-contract to the winning companies.

                                 ______
                                 

    Responses of Hon. L. Paul Bremer, III, Administrator, Coalition 
Provisional Authority, to Additional Questions for the Record Submitted 
                        by Senator John F. Kerry

    Question 1. In testimony earlier this week before the Senate 
Appropriations Committee, you were asked if this was the last 
supplemental request that the Congress will be asked to approve for 
Iraq or if you expect to be back asking for more next year. And you 
responded to the effect that you don't anticipate coming back for 
another supplemental ``of this magnitude.'' What magnitude do you 
anticipate?

    Answer. The administration has said that it expects this to be the 
only FY 2004 supplemental for Iraq and Afghanistan. On September 7, 
2003 the White House issued a statement that said, ``We believe our 
plan will obviate the need for future requests, and certainly for 
requests of this magnitude. Future Iraq-related requirements we would 
hope to address as part of our regular foreign operations annual 
request.''

    Question 2. The World Bank, as you know, estimates that 
reconstruction in Iraq will cost $65 to $70 billion over the next four 
to five years. The President, in this supplemental, is asking for about 
$20 billion, and you have said that it is for emergency needs. You and 
others in the administration have stated that you hope the 
international community will cover the remaining needs through pledges 
at the upcoming donor conference in October. What happens if they 
don't? Does the administration have a game plan for that contingency?

    Answer. The administration continues to expect that needed funding 
above the $20 billion will come from the international community and 
Iraq's own resources. The $20 billion the President requested is not 
intended to cover all of Iraq's needs. The bulk of the funds for Iraq's 
reconstruction will come from Iraqis--from oil revenues, recovered 
assets, international trade and direct foreign investment, as well as 
from contributions we've already received and hope to receive from the 
international community.

    Question 3. Mr. Ambassador, in his speech yesterday at the United 
Nations, the President made the point that as a young democracy, Iraq 
needs support. He said: ``And all nations of good will should step 
forward and provide that support.'' However, the President offered very 
little to those nations who want the United Nations to play a larger, 
more clearly defined role in Iraq's reconstruction and governance.

          What is the objection to putting these processes under the 
        authority of the United Nations?

          Wouldn't this significantly increase the prospects of getting 
        other countries to provide the $40-$5O billion additional 
        resources that Iraq will need, beyond the $20 billion the 
        President is asking the American people to provide?

          Is it really fair to put the American people in a position 
        where they may have to foot the entire bill for rebuilding the 
        country because the administration refuses to compromise?

    Answer. More than 60 countries are already contributing to Iraq's 
future, and the coalition of nations now in Iraq is acting under 
international law and United Nations Security Council Resolutions. Over 
thirty countries are providing military forces, and the British and the 
Poles are leading two multinational divisions. Coalition forces other 
than the United States have increased from 14,000 to 21,000 since May, 
and U.S. troop levels have fallen by 12,000.
    As of September 30, 2003, international pledges and contributions 
to the humanitarian and reconstruction effort in Iraq totaled nearly 
$1.5 billion. Since then, both Spain and Japan have announced 
significant financial assistance. A major international donors' 
conference is currently underway in Madrid, Spain with the goal of 
garnering additional contributions.
    The United Nations can contribute greatly to the cause of Iraqi 
independence--indeed, the UN is already carrying out vital and 
effective work in Iraq. We worked with other Security Council members 
and unanimously passed a new UN Security Council resolution (UNSCR 
1511) that strengthens the UN's role in Iraq.

    Question 4. Ambassador Bremer, the interim Governing Council has 
already assumed some degree of authority in that they are making 
appointments, passing laws with your signature, and spending money. Do 
Iraqis see the Governing Council as legitimate and what has the CPA 
done to enhance that legitimacy? If they do, why cannot sovereignty be 
transferred to them as an interim government just as we did with the 
Karzai administration in Afghanistan?

    Answer. Broadly speaking, the Iraqi people do see the Governing 
Council as a legitimate interim body. A recent Gallup poll showed that 
87% of Iraqis gave positive ratings for the Iraqi Governing Council. 
The Council's legitimacy will continue to grow on a daily basis. 
Already, they have begun passing laws, sending delegations to advance 
Iraq's interests around the world, planning the upcoming constitutional 
process, and assuming responsibility for governing their country. On 
September 1, the Council appointed 25 interim ministers to lead each of 
Iraq's 25 ministries. The ministers are directly responsible to the 
Council, and will quickly assume responsibility of the day-to-day 
operations of the Iraqi government. We intend to hand over increasing 
authorities to the Council and its ministers as quickly as possible.
    The Iraqi people's growing confidence in the Governing Council is a 
hopeful sign for the future of Iraqi self-government. But the people 
also understand the importance of moving carefully--but quickly--to the 
restoration of sovereignty to Iraq. They understand that a fully 
sovereign government should take power as soon as free elections can be 
held and that these elections should take place under the framework of 
a new constitution. Moving to restore sovereignty too quickly risks 
upsetting the deliberate progress we have already begun to undertake. 
Political parties in Iraq need time to establish themselves and build 
constituencies. The various ethnic and religious groups inside the 
country need time to work together and build confidence that a future 
Iraq will protect the rights of all citizens. Iraqis realize, too, that 
the Coalition military needs to be able to operate throughout the 
country, rooting out terrorists and remnants of the previous regime.
    In short, the Coalition has an important role to play in 
structuring a constitutional process that preserves Iraq's territorial 
integrity, builds democratic institutions, and guarantees religious 
freedom. We intend to pursue these goals by providing a secure and 
supportive framework for discussion throughout Iraq as the 
constitutional process takes hold. At the same time, we will continue 
to devolve power and authority to Iraq's interim leaders. In this way, 
we will proceed as quickly as possible to establishing an elected Iraqi 
government that is fully sovereign, and fully legitimate, under a new 
and fully democratic permanent Iraqi constitution.

    Question 5. What do you think we need to do to improve the security 
environment in Iraq? Are more troops needed?

    Answer. From the perspective of someone who lives in Baghdad, the 
security environment is improving. The most salient evidence of this is 
the thriving commercial environment, which could not exist in an 
atmosphere of crisis.
    The security situation will be improved by two programs already in 
train: First, by Coalition forces aggressively pursuing the bitter-
enders and other foreign and domestic terrorists. This program shows 
results every day in arrests, discovery of weapons caches and direct 
encounters. Second, by the patient hiring, training and deployment of 
Iraqis in the security services--the New Iraqi Army, the Border and 
Customs Police, the Facilities Protection Service, the Iraqi Civil 
Defense Corps and the Iraqi Police Service. Over the next two years, we 
expect to bring sufficient numbers of Iraqis under arms in specific 
security disciplines to significantly diminish reliance on Coalition 
forces to maintain security.
    While we welcome additional allied contributions to Coalition 
forces, I believe that our aggressive pursuit of terrorists and the 
steady, planned increase in Iraqi security forces obviates any need for 
additional U.S. troops.

    Question 6. What level of training are the new Iraqi police, border 
guard's, civil defense and military receiving? How many fully trained 
people in each of these categories will you have by the end of next 
September? When will you be able to fully turn over the security 
functions to Iraqis?

    Answer. Each Iraqi security service is receiving training 
appropriate to its functions. For instance, the Iraqi Police Service 
currently consists of a majority of rehired former Iraqi policemen. 
These individuals have basic policing skills that need to be reinforced 
and supplemented with additional training in democratic police 
techniques, skills development, crime fighting and respect for law. By 
late November, a police training facility in Jordan will begin 
providing Iraqi trainees with an eight-week course designed and managed 
by the Justice and State Departments. Subsequently, IPS will receive 
on-the-job training and advice from U.S. and international civilian 
police advisors/mentors (CivPol) in stations around the country.
    The New Iraqi Army (NIA), Iraqi Civil Defense Corps (ICDC), Border 
and Customs Police (BCP) and Facilities Protection Service (FPS) all 
are receiving comparable training appropriate to their security 
functions. These organizations already have taken over specific 
security functions or are working in conjunction with Coalition forces 
to improve security. All security functions will be turned over to 
Iraqi forces when they are fully trained and functioning.
    Currently planned force levels for which supplemental funding is 
now being sought, with target dates for those plans to be executed are:

    NIA:--27 Light Infantry Battalions by end of 2004 (approx. 40,000 
personnel, including command, support and specialized elements).

    ICDC:--18 Battalions by early 2004 (more than 15,000 personnel).

    BP:--More than 20,000 by September 2004.

    FPS:--Approx. 20,000 with a goal to expand in 2004.

    IPS:--Approx. 70,000 trained, and in service, including 25-30,000 
graduates of international training course, by 2005.

                                   - 
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